Ruth Mitchell

Member Article

Rock to return to 90% lending

NORTHERN Rock could reportedly return to riskier lending this week by launching its highest loan-to-value mortgages since it was bailed out by the taxpayer three years ago.

The Newcastle-headquartered group is set to start offering 90% mortgages as early as this week ahead of its impending return to private ownership, according to press reports last night.

At the peak of the old Rock’s pre-crash boom, it offered mortgages as high as 100% but has since restricted the loan-to-value it offers its customers to 85%.

While potentially more profitable, high loan-to-value lending is also more risky, particularly in the current climate where house prices are facing downward pressure.

Several banks, including HSBC and Santander, have been slowly returning to the high loan-to-value market.

This was posted in Bdaily's Members' News section by Ruth Mitchell .

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