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uk, said, "Rising property prices has meant that people need to borrow even more money to get the property they want and lenders have responded to this by dramatically increasing the number of 100% mortgages available.
However there are indications that the house price boom is slowing so anyone taking out a 100% mortgage is risking being stuck in negative equity.
It said that many first-time buyers find it impossible to save towards a deposit and that 100% mortgages were the only way to get on the housing ladder.
However the repayment terms are not as favourable on these loans compared to mortgages where a deposit of 10 to 15% has been contributed and buyers taking on a 100% mortgage could leave themselves with less forgiving interest rates and higher repayments.
There are now just seven lenders who have 100% mortgages, compared with about 40 in November, with Abbey the only group willing to offer the deals without conditions.
A 100% mortgage requires no deposit and will normally offer free valuation and no higher lending charge.
She says the withdrawal of 100% mortgages, coupled with new mortgage restrictions, will make it even more difficult to get her foot on the property ladder.
THE UK's fourth biggest lender yesterday became the latest firm to withdraw from the 100% mortgage market.
ENGINEER Antoni Mundell did not have any savings to buy his first home so had to opt for a 100% mortgage.
The number of 100% mortgage products available direct from a lender has increased by 70% in the past six months, new analysis from online mortgage company mform.
About 5% of people taking their first step on to the property ladder take out a 100% mortgage, meaning they have no equity in their property.
A 100% mortgage will require no deposit and will normally offer free valuation and no higher lending charge.