Mortgages & me

Bringing both explanation and humour (yes, it is possible) to an often perceived realm of boredom

Mortgages. Let’s not kid ourselves here. If you had the choice of having one or not then there would be no choice. However, the vast majority of us, Russian billionaires excluded, need them to fuel that much loved British tradition – homeownership. So, if we all accept that we need them, you may as well do something positive and get the best one for you. It is staggering how many people make sure they get value for money from every day items but do not manage their home loan properly - the savings far outweigh the difference between the best baked beans and the value ones.

So, this blog will attempt to look at the world of mortgages and the housing market and try to bring both explanation and humour (yes, it is possible), and spark some comment, to an oft perceived realm of boredom. Here goes…


17/05/2013 by Simon

The Building Societies Association (BSA) has revealed that mutual lenders increased their mortgage lending by 19% year-on-year, in the first three months of 2013, from £6.5billion to £7.7billion. ...

Categories: Mortgages, Buy to let, Mortgage Lenders, Interest rates, Remortgaging, Moving Home, Commercial, Home Mover

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27/03/2013 by Simon Collins

So the British Bankers Association’s (BBA) February figures show a drop in mortgage approvals for purchases of 6% compared to the same month in 2012. Many industry analysts claim the drop is a timely reminder that despite last year’s introduction of the Funding for Lending scheme, the mortgage and housing markets were still a long way off functioning properly. The BBA report then makes the blindingly obvious statement that more First Time buyers would help. How though do you find more of the supposedly elusive creatures? With rental prices being driven ever higher, there are many people who’d rather pay their own mortgage than someone else’s.

 

However there would appear to be two main factors stopping a new First Time Buyer making the move into property ownership, Lending Criteria and Consumer confidence.

 

Lending criteria particularly for First Time Buyers is still far too prohibitive and many good cases are being declined for reasons that most sane people would describe as petty. After the mortgage price war we’ve seen over the past few months, a relaxation in criteria would seem the only logical step left to try and increase lending levels, however lenders are worried about going too far and being described as reckless.

 

Consumer confidence is still running low, as the stubbornly high inflation level and low wage growth continues to squeeze household incomes, leaving many would be borrowers without the appetite to take on debt. The economic outlook remains uncertain at best, and it would seem that it’s not likely to change anytime soon. The plus point though is that many properties are more realistically priced, and therefore offering better value for money. It could be said to be a great time to buy.

 

More schemes that essentially prop up the big house builders (First Buy, NewBuy, Help To Buy) are not the answer, decent product innovation is. For those who don’t have access to the ‘Bank of Mum & Dad’, a good example of this is the Saffron Building Society’s ‘Rent To Buy’ scheme. The product is open to those want-to-be First Time Buyers who have been renting for a minimum of 12 months, and it’s available at 95% LTV upto a maximum loan size of £500,000. The core principle of the scheme is that by only opening it to applicants who’ve been renting for 12 months, they are looking at people who are already experienced at running a household and therefore more likely to handle a mortgage payment that’s likely to be at least the equivalent of the rent. The rate is fixed until 31/08/2016, but there are no penalties for overpayments or early redemption, and crucially, the lender ‘credit checks’ rather than ‘credit scores’ which makes it more likely for a sensible lending decision to be reached. More of this type of product is what we need to get the market (and people) moving again..

Categories: Mortgages, Interest rates, House Prices, Mortgage Lenders, First time buyers, Government

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19/11/2012 by Drew

A broker has just claimed that last month they saw the largest take up of two year fixed rates so far this year, mainly on the back of lenders raising their Standard Variable Rates (SVR) over the past few months! Not an earth...

Categories: Mortgages, Interest rates, Mortgage Lenders, Long term fixed rates, Fixed rate mortgages, First time buyers, Remortgaging, Moving Home, Home Mover

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17/10/2012 by Drew

Nationwide’s decision to cease all new interest only lending, and only allow existing borrowers to take additional funds on a repayment basis, is the latest example of lenders (predominantly the larger high street  ones) trying to...

Categories: Mortgages, Interest rates, Mortgage Lenders, Remortgaging, Moving Home, Home Mover

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22/11/2011 by Drew

HSBC’s recent claim that “81% of all best buys are provided by direct lenders” seems to have missed out on the vital point of it’s only a “Best Buy” if you can actually get it. If you can’t it might as well be on the moon. “How do...

Categories: Mortgages, Mortgage Lenders, Tracker mortgages, Fixed rate mortgages, First time buyers, Remortgaging, Moving Home, Home Mover, Buy to let

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23/02/2009 by Drew

Northern Rock is set to return to the mortgage market with a £14bn lending plan only 12 months after it was nationalised.  The nationalised bank will also offer deals up to 90 per cent loan to value, a level that has been severely...

Categories: Mortgages, Interest rates, Mortgage Lenders, Government

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21/11/2008 by Drew

The historic cut in interest rates of 2% over the last two months has seen many mortgage borrowers’ monthly payments reduce dramatically.  You should, if you can, maintain pre-cut payments and use the low interest rate environment...

Categories: Mortgages, Interest rates, Mortgage Lenders, Tracker mortgages

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27/10/2008 by Drew

The Markets suffer yet again, particularly the Far East  :-

Nikkei (-6.4%)  lowest level for 26 years  
South Korea - Kospi (+0.8) following rate cut of 75bps
Hang Seng (-12.7%)  biggest single day fall since 1991
China - Shanghai...

Categories: Interest rates, House Prices, Mortgages, Mortgage Lenders

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16/10/2008 by Drew

Another bad day for the markets yesterday, with the Dow finishing 733 down, the Nikkei 1,089 and most other indices were in negative territory.  It is also not looking promising today as the FTSE slips below 4,000 in early...

Categories: Mortgages, Interest rates, Mortgage Lenders

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21/08/2008 by Drew

News from the Council of Mortgage Lenders that lending activity picked up very slightly in July, with £24.8 billion advanced to borrowers. This is up a modest 5% from June, but still down 27% year on year. ...

Categories: Mortgages, Interest rates, Mortgage Lenders

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Your initial mortgage consultation is obligation free. There will be a minimum fee for our mortgage service of £450, of which £150 is payable when you apply, and we will retain the commission from the mortgage lender. Alternatively, you can choose the fee only option which is typically 0.65% of the amount borrowed. The precise amount will depend on your circumstances and mortgage loan amount, and will be discussed and agreed before you make a mortgage application.

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John Charcol is a trading style of Towergate Financial (West) Ltd, which is authorised and regulated by the Financial Conduct Authority; our registration number is 147692. John Charcol Associates LLP is an appointed representative of Towergate Financial (West) Ltd, which is authorised and regulated by the Financial Conduct Authority.  Registered office: Towergate House, Eclipse Park, Sittingbourne Road, Maidstone, Kent ME14 3EN. Registered in England No: 02292688.  This mortgage site is only directed at persons within the UK.   The FCA does not regulate some investment mortgage contracts.  Calls may be recorded for training and monitoring. Max call charge from a BT landline is 3.9p per minute. Calls from other networks may vary.