Kate Barker in favour of 100% mortgages

Kate Barker, a government adviser on housing and member of the Bank of England’s rate setting committee, has said that mortgages which leave buyers with a risk of negative equity should not be banned and banks that demand huge deposits may have been ‘overdone’. She said that banks over-reacted to the credit crunch by withdrawing so many mortgages for borrowers with small deposits. She also indicated that targeting inflation alone was not sufficient to ensure economic stability.