Homebuyers increasingly looking for 100 per cent mortgages

The number of 100 per cent mortgages granted to homebuyers rose by more than a quarter last year, according to a new report.

Researchers for the Mortgage Advice Bureau found that there was a 26 per cent increase in the number of such mortgages granted compared to 2005.

It was also found that the number of homeowner borrowing an amount equal to or above the value of their property rose 50 per cent.

Ray Boulger, of mortgage broker John Charcol, said many homebuyers looking for such mortgages would be graduates saddled with debt from their university days.

He explained that many “are faced with the choice of either delaying a house purchase until their debt has been cleared or taking the plunge earlier with the aid of 100 per cent plus home loans”.

In related news, recent research from the Portman Building Society indicates that house prices rose last year by just over ten percent.

This means the cost of an average first-time buyers property went up by around £14,000 in 2006.

© Adfero Ltd

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