Mortgages Uncovered

Mortgage Payment Protection Insurance (MPPI) is a type of insurance policy that you can take out so if you cannot make your mortgage repayments for any reason covered by the policy, the policy will make the repayments.

Insurance protection for your mortgage can prove invaluable at times when you lose your job because you have been made redundant, when you are off work because of a covered illness or if you are recovering from an accident.

When you take out this insurance make sure that you declare any current medical conditions you have with the insurance provider, as they may not make the necessary payments if you claim for a condition you had before the insurance premium was taken out.

Under new plans drawn up by the City watchdog, self employed persons will have to wait at least two years before they can get a loan. New business traders will thus not be able to buy their first home or even move house. This also means that those people who find that their one year introductory mortgage is coming to an end will be stuck on the standard variable rate until their two year trading anniversary.

The change has come about because from today lenders will have to confirm their applicant’s income which means that self-cert mortgages are effectively a no-no.

So how do you get a mortgage if you are self employed?

You now need to show two years tax returns or two years company accounts’ to get a mortgage if you are self employed.

It seems that the mortgage market is not recovering as well as expected, after reports that the number of mortgage products available in the UK dropped in the two weeks up to the beginning of July. At a time of year when many homeowners feel the need to move, this is not the news the new government expected.

The figures produced from Moneyfacts.co.uk stated that although the figures are much better than at the start of the year, when there were only 1600 products on the market, the numbers have stalled with little change to the 2600 products currently available.

The banks have also stated that they expect lending to fall over the next three months prompting fears that a new mortgage squeeze could be on the way. Mortgage rates are still dropping slightly, which is good news for borrowers, but it remains to be seen what happens in Q3 and Q4.

It can be really easy to get a mortgage from your bank or building society. You just have to walk in the door and because you are a current customer, they will blind you with technical jargon and what seems like great figures and you will leave with a mortgage in place. However this is really not the way to do it.

Banks and Building Societies will only have a limited range of mortgage deals and will fob you off with one of their own offers. What you need to do is spend a little time researching the market to find the best deal. If you use a website that offers a range of current best buy deals, you will be able to compare quotes and choose the most suitable deal available. Mortgage companies are falling over themselves to find suitable borrowers and by getting the best deal you could save a considerable amount of money.

I am going to move away from mortgage advice a little and show you a perspective that is affecting the housing market in a positive way. Although this is being a little a unfair as the people it affects are pretty much victims of bullying. Neighbors from hell are more and more common these days and they can start from simple arguments over:

• Aggressive behaviour
• Excessive noise
• Messy property or garden

Anti social neighbors can affect the property of your price by an average of £30000. These problems should be looked to be resolved as they more or less are normally a simple misunderstanding.

In February 2010 mortgage lending has risen by 6% to 9.2 billion pound. These figures come from the council of mortgage lenders. This is an unusual increase as February normally does not see any increases in fact these are possibly some of the harder time being the start of the year and being closely after the Christmas period.

These figures are encouraging for the recovery of economy in the UK and are expected to continue to improve. Provided house prices do not fluctuate too much the UK will find these figures continually rising, however this is a big ‘IF’ and could go the way we do not want it too.

Properties in the rental market are becoming harder to come by everyday. This means that tenants are now being faced with higher rental values and these impact houses for sale and the economy as a whole. Higher rental value means that first time buyers will struggle to buy properties. This also means that low paid work will not even be worth taking for a lot of people. The economy as a whole will become affected by this.

Either landlord’s are not finding the rental market to be as lucrative as it once used to be or they are not longer investing into further properties.

The number of houses for sales has now hit an 18 month high. Prices are falling again but speculators believe this sharp rise is due to the unexpected weather the UK has experienced this year. The typical asking price is now £230000 is up to 5.3% higher than March last year. First time buyers are still struggling a lot to even be approved for mortgages. This continues to get worse as house prices are very much fluctuating. The hardest hurdle for a first time buyer is the initial down payment.

Latest figures show that sales have halved at the start of the New Year.

The housing market in January 2010 saw large dip in activity so much so that lending fell by 17%. Mortgage advances also fell in the month of January y nearly £3 Billion. These figures come just as nationwide announced that house prices have fallen for the first time in ten months in February 2010.

This fall in house prices is according to Nationwide down to the harsh winter weather that the UK has been seeing. The following months will be very interesting to watch to see how the economy is continuing to recover from the recession and the house price demands.

Nationwide yesterday defended the launch of their 125 per cent mortgages.

The building society said the “very niche” product was only available to existing borrowers who needed to move, but owed more on a mortgage than their property was worth. A Nationwide spokesman said:

“We are doing something socially responsible.

In my opinion this is just another way for the banks to get round the problem of lending money to make it look as if they are morally correct. And anybody with a bank account knows that the banks and building societies are only in it for the money at the end of the day”