Nationwide launched a 125% mortgage this week! Sadly, most reports failed to spot that this scheme is for existing borrowers, in negative equity, looking to move house! Positive news, but the hype will have teased first time buyers who will have to wait a while longer yet! In the middle of 2007, there were some 28,000 first time buyer products. Today, there are roughly 1,200.
Are you confused about house prices? I am. Nationwide recently reported that house prices increased in June by 0.9%. Halifax refuted this stating a decrease of 0.5% in the same period! If they cannot agree what chance do we have? Your guess is as good as mine. Let’s wait for the Land Registry report, although they are usually three months behind the pace due to reporting timings!
The Bank of England retained base rate at 0.5% last week. Good news for those on tracker rates. Not such good news for the market generally. Customers who have recently finished a fixed rate period with a lender will revert to the lenders currently low standard variable rate (SVR) and remain there quite happily. Lenders SVR’s tend not to change unless bank base rate does. However, it is borrowers moving from lender to lender which helps to stimulate money movement in the financial markets. Borrowers leaving a lender release funds for someone else, and so on. With minimal movements, the lenders enjoy continued excuses to restrict lending! Or, is it me…!
Finally, re-mortgage applications have increased recently. Borrowers looking to secure long term fixed rates are applying at the right time. Some, who are in increasing financial difficulties, are looking for sensible ways to remortgage (not always our recommendation). Others are releasing equity to acquire Buy to Let properties in the current cheaper climate. Whatever your requirements, speak soon to an independent mortgage advisor. You know who to call…
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