The Times - Homebuyers denied loans over negative equity fears
Nationwide has stopped mortgages for borrowers with small deposits over fears that a house price crash will leave homeowners with negative equity.
Nationwide, Britain’s biggest building society with 1.6 million customers, said that it would not accept new borrowers who had less than a 15 per cent deposit. It is the first big lender to warn about the dangers of negative equity, in which a borrower’s mortgage is greater than the value of their home.
Aaron Strutt, product director at the broker Trinity Financial, told The Times: “It is unusual for a lender to make a public statement about negative equity.”
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