Mexican banks appear to be moving down the food chain in mortgage lending, according to a release by Moody’s Investors Service.

Banorte, Santander and Scotiabank all announced deep rate cuts in their mortgage products in mid July, an indication that they are tapping lower-income borrowers, the agency said. They are now lending at rates that are nearly 200 basis points below the April 2011 average of 11.8%. At the same time, LTVs could hit 95% in these banks' co-financing programs with government agencies Infonavit and Fovissste. LTVs averaged 67% in April, Moody’s said.

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