Outlook good for first-time buyers who have a deposit

I was contacted by the local press for comments and to give advice for first time buyers, thought you might be interested in some of the things I told the reporter Halima Sadat the reporter for the Local news paper, Aldershot and Camberley News.

Michael Usher of Michael Usher Mortgage Services says in the first instance it is important to get sound advice from an independent financial adviser.

“At the moment, things can change very quickly, so keep an eye on the market because there will be some better lending opportunities in the next few months,” he said.

“I think the base rate will stay low for the rest of the year, so it could be a good idea to get a low fixed rate mortgage for two or three years.

“At the moment, lenders are not lending to low deposit borrowers because house prices are still falling, which means that the value of their loan in relation to that of the property is not so certain.

“But something has got to give and already there are one or two mortgages about with an interest rate of 4.9% against a 15% deposit.

“All we need is for one brave lender to start lending to low deposit borrowers and then the rest will be forced to follow.”

Commenting on the latest announcement from the government that it will offer state insurance for banks in an effort to shore them up and encourage lending to businesses and individuals,
Mr Usher continued: “The government’s recent decision to act positively is a welcome move.

“The intention to buy up bad assets and guarantee others forms a large part of these sweeping measures. Hopefully, a more balanced approach, with cushioning from the peaks and troughs we’ve seen lately, will bring confidence back to lending.

“It may take some time before we see these measures improve opportunities and offerings for first-time buyers, but they should filter through eventually.”

You can read the full report here