Mortgages Uncovered

According to Assetz Finance, there has been a 10 percent increase in enquiries about overseas property investment since the recent changes in the UK mortgage market, with France and Spain being the most popular destinations.

In France, many building societies and banks have now introduced 95% and 100% mortgages with little or no set up fees involved.  Contrary to the UK where this level of mortgage has been withdrawn by most lenders, French mortgage lenders and indeed other European lenders are widening their mortgage offerings making an overseas investment even more attractive Read the rest of this entry »

The British Bankers Association released figures this week showing how the UK mortgage market is still deteriorating.  Most of the mortgage lending in February was accounted for by remortgages only, rather than new mortgages.

In fact, year on year, the number of mortgage approvals fell to just 43,870, very close to a record low.

With many mortgage lenders either increasing their mortgage interest rates or even withdrawing their products completely, this shows how much the credit crunch is putting pressure on the UK banking sector. Read the rest of this entry »

First Direct announced plans this week to hike its interest rates. They withdrew their 4.75% tracker two year deal and replaced it with a 4.95% mortgage instead.

Their mortgages have been in demand so much Read the rest of this entry »

One of the UK’s biggest mortgage lenders, the Nationwide, has announced its intention to increase its mortgage rates to help cope with the UK credit crunch.

Some of its mortgages, including fixed and tracker rate deals, will increase by around 0.6%. That’s a big hike for many mortgages.

That will put some of its interest rates at up to 7%. Some believe that the Nationwide is effectively pricing itself out Read the rest of this entry »

According to the Council of Mortgage Lenders (CML),  the huge rise in interest only mortgages over the last few years has still not yet reached the number of interest only mortgages taken out in the early 1980’s.  The increase shouldn’t be a problem providing people remember to reassess the repayment options throughout the course of the mortgage.

Many people have taken out an interest only mortgage or even switched to an interest only mortgage just to make it more affordable.  However, interest only mortgages are meant to have a repayment vehicle running alongside them to pay off the mortgage at the end of the term.  Many people have nothing.

Bernard Clarke at CML said that taking out an interest only mortgage without a repayment vehicle in place is a:

“perfectly rational approach as long as the borrower is fully aware of the consequences and reappraises the need to put in place a plan for the repayment of the capital over the course of the loan”

Despite Darling’s recent call for a report into providing more long term mortgages, it seems that those who currently opt for longer term mortgages could be paying more for their trouble than previously.

There are now over 130 mortgages available with fixed rates for more than ten years and the government is calling for more in order to help stabilise borrowers payments and provide them with more security.  This is the only type of mortgage that now Read the rest of this entry »

The Council of Mortgage Lenders (CML) states that tracker mortgages are on the increase as first time buyers are encouraged by the recent interest rate cuts in the last couple of months from the Bank of England.

“In the normal course of things, first-time buyers have tended to be more attracted to fixed-rate mortgages recently than variable-rate mortgages,” said CML spokesperson Sue Anderson.

Tracker mortgages go up and down in line with the Bank of England interest rates, so these allow borrowers to take advantage of any decreases.  However, the downside is that borrowers will also feel the effect of any increases.  Those who take out tracker mortgages have to Read the rest of this entry »

Alistair Darling continues to emphasise that the UK mortgage and housing market is still stronger than the US market.  My concern is that the UK market is only moments behind the US - you know the saying ‘when the US sneezes, the UK catches a cold’

In America, sub-prime borrowers have been at the heart of their problems with many people defaulting on their mortgage.  Unfortunately, banks had invested heavily in sub prime mortgages over the last few years.

Darling insists these problems are far less in the UK.  The key difference he stated on Wednesday in Read the rest of this entry »

The Council of Mortgage Lenders (CML) has called for action from the Bank of England to help with the mortgage crisis.  Regular readers will be aware that many mortgage providers have been withdrawing their new mortgage offerings, because of the influx in new mortgage applications and the lack of wholesale market funding for lending.

Mortgage lending has dropped in February by 7% compared to January.  They have requested that the Bank of England improve levels of liquidity to enable the banks to continue lending. Read the rest of this entry »

Following on from our earlier article about Scottish Widows withdrawing several of their mortgages, two more lenders have now followed suit.

Bath Building Society and Earl Shilton Building Society have withdrawn ALL their mortgages except for the Standard Variable Rate, which regular readers of this site will know we do not recommend anyone be on that!

Bath BS says it has simply run out of lending money! Read the rest of this entry »