95% Mortgages

If you have a lot of costly unsecured debt or you need to raise money against your home to start a business you should consider the 95% mortgages available. The often have higher costs and fees and less attractive rates, but if you need the equity out of your home they are ideal.

Some lenders will lend 95% of your homes value even if you have got some bad credit history or something else bad in your past like a CCJ (county court judgement) or default. Many people would be better off with a 95% mortgage on their home rather than expensive car finance or store cards with balances on them at interest rates of around 32% APR.

Also, getting a very high loan to value mortgage is a way of protecting your own money. For example, if you own a home with say a 40% mortgage and property prices crash by 40%, the money that is lost in your home is your money, the lenders money is safe. If you have a 95% mortgage and the property prices crash but 40%, you have only lost your 5%, and when it costs a few percent to sell anyway after agents and lawyers fees, at 95% you have very little in the house any way. If you had a 95% mortgage and property prices crashed, you just stop paying your mortgage and live there rent free for 6 months, and drag out any court action by calling into the court sick on court days and other tricks. Even making partial payments on the mortgage can drag out re possession by a long time so you are paying the lender less each month than it would cost to rent the property.

90% Buy to Let Mortgages

As most lenders consider buy to let lending slightly higher risk than lending against your own home they will only usually got to 90% percent loan to value. Like any higher loan to value mortgage 90% buy to let mortgages often have higher fees and other setup costs involved, so you should only consider them if you really need the equity out.