So Northern Rock is to get back into mortgages. I hear the cheers.
The aim will be to get the first time buyer market moving. I hear more cheers.
It will start lending on loan to value rates of up to 80% or even 90% - definitely not 100%, because that should be illegal. I hear yet more cheers.
Then I think about it from the point of view of the surveyor valuing the property who is looking to put a "fair price" on the two-bed flat so passionately sought by the first time buyer in question.
If house prices are falling, what valuation will I give it? Must be prudent, must be prudent.
The point is that a 90% loan to value mortgage on a valuation of 90% of the agreed sale price is after all equivalent to an 81% loan to value mortgage.
An 80% loan to value mortgage on a valuation of 90% of the agreed sale price is after all equivalent to a 72% loan to value mortgage.
What difference will the reborn Northern Rock make? Well we'll just have to wait and see.
As things stand The Rock is really rather caught between prudence and a hard place.
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