Taxpayer-Funded Banks Fail To Act Competitively

Despite receiving funding from taxpayers more than 12 months ago, many leading lenders are still failing to act competitively across the mortgage market according to research by property website Moneyfacts.

Even with the Bank of England keeping the Base Rate at a historic low of just 0.5%, a division seems to be appearing across the mortgage market between taxpayer-funder banks and non-state funded…


Analysing the average 2 year fixed rate on a 75% LTV, Moneyfacts discovered that many taxpayer-funded banks such as Cheltenham & Gloucester, the Halifax and Northern Rock were all offering interest rate deals of around 4.19% - far from the competitive deals they should be offering following the BoE’s decision to keep the Base Rate where it is.

Speaking on this issue, many property advisors believe that this lack of willingness to lend is based purely on their desire to get out of government ownership. Yet the people who appear to be taking the brunt of this decision are the very same taxpayers who helped to bail them out in the first place.

Yet it is not all doom and gloom…

Some non-state funded banks are planning to launch a range of competitive deals to help property investors/first time buyers back onto the property market:

• As of the beginning of March there are now 1,798 mortgage deal available
• 100% mortgages and 95% LTV’s, although still small in number, are making a comeback
• 85% and 90% LTV’s have increased in supply by 90% in the last year with 489 deals available

Original Article

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Peter Franklin, Property Mentor Delegate

I used to believe stocks and shares were the only way forward, yet after 15 years of property investing, neither of these can compare with the sheer velocity or impact that property investment can have on your bank account. Only with property can you truly experience the power of being in control of immediate cash flow AND capital appreciation. Stocks and shares simply cannot compete. Read more