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Jul 16
Buying a home for the first time is a daunting prospect, that’s a fact. So much to take in, a whole host of new things to learn and major decisions to make.
Add to the equation the issue of arranging your first mortgage, and things become even more confusing and it has to be said, stressful.
Keeping a clear mind during the buying process is crucial so that all decisions made are done so with proper focus. So why cause yourself additional pressure by trying to choose your own mortgage? (more…)
Jun 26
With mortgage lenders such as Halifax following Britannia, Yorkshire Bank and Scottish Widows into a phase-out of interest only mortgages, there has never been a more crucial time for borrowers – especially those with complicated situations – to take independent mortgage advice.
Lending criteria is being further tightened as a precautionary measure leaving borrowers in the dark over their options, especially those who are self employed, have credit issues or are looking for investment lending.
Lenders Protecting their Own Interests
Halifax has recently added a 0.2% premium on its interest only loans, effectively protecting themselves from default borrowers and closing the door on the interest only option.
When the interest rate fell from 5% to 0.5% at the beginning of the recession, people on interest only mortgages benefited greatly. However, it is believed that instead of putting aside the money saved to pay off capital; many are expected to have squandered it. The risk of borrowers defaulting on these loans is high and therefore the banks are understandably nervous.
So who will this phase-out affect? Unfortunately, even responsible borrowers will potentially lose out as the regulations are tightened across the banking and mortgage industry. First time buyers and buy to let investors will be reeling as they previously favoured interest only loans due to the lower monthly repayments compared with other types of mortgage.
Self employed borrowers who have in the past favoured interest only mortgages for their flexibility will now find it far more complicated to find finance.
Focus on the Positive
However, Geoff Charles, Managing Director of Bower Mortgage Company, believes that borrowers should focus on the positive side of the phase out.
“Interest only mortgages should never have been seen as a permanent solution. With these interest only loans being phased out by major lenders, it may make people sit up and realise that by seeking independent financial advice there could be better options available to them.”
Your home may be repossessed if you do not keep up repayments on a mortgage or any debt secured on it.
Bower Mortgage Company: FSA regulated UK-wide mortgage advice from friendly, qualified, experienced mortgage planning specialists. Quality, face to face advice and a strong focus on building long term customer relationships. For money saving mortgage and mortgage protection advice, contact Bower on 0800 411 8668 or e-mail info@bowermortgagecompany.co.uk.
Jun 05
The next two years could spell bad news for borrowers who have failed to take action and fix their mortgage rates, as warnings abound over soaring rates which could force repayments skywards by £3,000 on a £200,000 mortgage, a recent report in the Sunday Times stated. (more…)
May 29
Home Information Packs were introduced in 2007 with the aim of speeding up the process of selling a house by presenting buyers with much of the conveyancing information right from the start such as local searches, property information and Title Deeds. (more…)
May 21
With the catastrophic events of the past two years in the banking industry, mortgage borrowers unsurprisingly lack confidence in finding the best mortgage option to best suit their needs. A recent survey has concluded that seeking advice from an independent financial adviser is the best policy to follow before choosing a mortgage. (more…)
