The Treasury has told the banks it will charge them a
supposedly "commercial" rate of about 0.9% for insuring up to
three-quarters of the first 20% of losses on mortgages for homebuyers who
cannot afford to provide a big deposit. And
apparently that 0.9% applies to the whole loan, not just the insured
proportion. The charge is necessary to
prevent Brussels ruling the scheme as illegal state aid. But it implies that Help to Buy ll could be
quite a money-spinner for the Treasury. The government could receive annual
revenues of just under £12bn a year, if it were to provide guarantees on the
maximum £130bn of mortgages it estimates that it could insure. As one banker
said: "Unless the mortgages go sour, the Treasury will clean up."
Read more on the BBC website.
No comments:
Post a Comment