Home-owners looking for remortgage finance find they have lost much of their equity.

Declining property values have left many home-owners looking for remortgage finance with serious equity shortfall. Home-owners who had hoped to go shopping for a new mortgage deal with plenty of equity built up, have been disappointed to see their equity significantly reduce due to a drop in property prices since the credit crisis.

Without new buyers house prices will continue to decline and further equity will be lost. For those without sufficient equity the best remortgage finance deals are likely to be out of reach. New buyers are finding high mortgage deposits demanded by lenders difficult to achieve and many first time-buyers are not in a position to make a first step on the property ladder. In an attempt to get this end of the property market moving the Halifax are offering a new 2 year fixed rate mortgage deal specifically aimed at first time buyers, the deal is 5.99 per cent for 85 to 90 per cent LTV with no fees.

In some geographic areas house prices have dropped to levels where some home-owners have hit negative equity. This is especially true for those who purchased at the peak of the market and, for those in negative equity, remortgage finance may be impossible to find. For those in negative equity the best course may be to attempt remortgage through a broker who will know which lenders to approach and how an application is best handled.