Woolwich make interest only change
The Woolwich are the latest lender to cap their interest only lending policy to 75% loan to value. They have made some pretty drastic changes and now borrowers are required to have £150,000 equity in their property if they want interest only.
There are lenders that offer low deposit mortgages on interest only, but they are disappearing pretty quickly. The Financial Services Authority have been very keen to get lenders to reduce their exposure to interest only mortgages and also to get more borrowers to switch to capital repayment.
Even if you are at 10% ltv and you have £100,000 equity in you property - you still won't qualify for interest only with the Woolwich if you do not have an acceptable repayment vehicle in place.
Some of the other lenders to cap interest only at 75% ltv are, Santander, Royal Bank of Scotland and the Skipton Building Society.
October 22, 2010
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