A
product that needs to be handled correctly in order
to reap the potential benefits with no deposit. So
expert help is obviously very prudent. This is generally
where 95% of the home loan is secured on the property
but the extra 30% or £30,000 which ever
is
the lower, is an unsecured loan at the same loanrate
as the secured part. This type of lending is high risk
so the lender will only accept a borrower with a good
credit history. Now due to the credit crunch these types
of products have been withdrawn due to their risk..
Caution
should be taken as there is no equity in the property
and the borrower may have to in the short term move
or sell for example with job relocation. This restricts
what the borrower can do in the early years and there
is no guarantees the house prices within the UK will
remain high or increase.
The
extra money is ideal to consolidate debt but caution
must be taken as the borrower maybe by consolidation
converting unsecured debt in secured debt and lengthening
the loan term. With a purchase the extra money can be
used for government stamp duty, property lending related
fees, home improvements and furnishing a property.
Some
lenders may give a very high income stretch with this
type of mortgage but the lender will look for an impeccable
credit rating with a high earning.
As
a regulated mortgage broker we may be able help you,
so please contact us
or call 0800 781 0414 for friendly assistance.
