Higher loan-to-value (LTV) product choice in the mortgage market has reached its highest level for 17 years, according to data published by Moneyfacts.

The group’s latest UK Mortgage Trends Treasury Report revealed that the combined choice of 90% and 95% LTV mortgages has risen to 1,360 options this month, the highest level since March 2008, when there were 1,532 options.

Moneyfacts also reported that these higher LTV deals now represent 19% of the residential mortgage market overall.

Product choice across the entire mortgage market has increased month-on-month at the beginning of September, to 7,062 options, which is the highest count on Moneyfacts’ records since 2007.

Finance expert at Moneyfacts, Rachel Springall, commented: “The Government has been adamant that they want lenders to do more to boost UK growth, so a rise in mortgage choice is positive.

“However, it may be a bit too soon to celebrate, as affordability remains a critical hurdle for buyers, and those who want to secure their repayments for the next five years will find higher LTVs are only dropping by miniscule margins. Indeed, the average 95% and 90% LTV five-year fixed rates fell by just 0.02% and 0.01% month-on-month.”

Springall added that lenders can adopt a more “cautious” approach to pricing their mortgages when swap rates rise, leading to small margins of moves, but deals can still be reviewed.

“During August, the average shelf-life of a deal was unchanged month-on-month at 17 days, so the churn of products did not calm,” she continued.

“Therefore, borrowers will not want to miss out on securing a new deal, such as those remortgaging. In fact, those looking to stay with the same lender could secure a new deal four months before their current initial rate ends. This window has been shortened from six months by a handful of lenders since last year, as rate volatility calmed, so it could change if rates were to rise dramatically.”

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