24 June 2011

The 'mortgage product sale' continues!

The great ‘mortgage product sale’ has continued over the last week with some lenders reducing rates and one lender offering market leading products for just 7 days! This is the third ‘1 week’ sale we’ve seen in the last month and, in this instance, the products were very competitive short and long term fixed rates. Lenders who have recently reduced rates include Woolwich, Santander, Halifax and Leeds. Most lenders also offer a free valuation (and free legal costs on remortgages) to attract new business.

The government has issued details of the FirstBuy scheme this week. Announced in the budget, the scheme is aimed at assisting First Time Buyers purchase their first home. A 5% deposit is required, a 20% equity loan is funded by the government and house builder and the remaining 75% is funded by a mortgage, from the lenders taking part in the scheme. The loan is then repaid on resale of the property. The suggestion is that this will help over 10,000 first time buyers over the next two years, but let’s see the scheme in action first before commenting on the possible results! First timers are encouraged to register their interest as the first ‘new build’ properties are due to be available from September. More information is available on the Directgov website but, as yet, no questions and answers page!
The Financial Services Authority (FSA) have released Mortgage Lending Data figures revealing that repossessions increased by 17% in the first quarter of 2011. There were 9,613 possessions during the first three months of the year. These figures are collated from around 300 lenders submitting their quarterly mortgage lending activity returns to the FSA. New arrears cases in Q1 were 8% lower than the previous quarter, while the total number of accounts in arrears at the end of Q1 were 2% down on the previous quarter.

Finally, if you are already working in the mortgage industry and fancy a new challenge, AToM is looking to recruit experienced and qualified mortgage professionals. Come in and see us or visit our website to find out more!

16 June 2011

Great products on offer - time to Remortgage?

There has been a lot of movement in the mortgage market recently. Lenders half-year figures are due shortly and it appears that some of them will be slightly short on new business volume targets and as such have had to try and remedy the situation. Two lenders in the last two weeks have issued market leading products but only allowed a 7 day period for applications, before withdrawing the products entirely. These ‘quick sale’ products provide superb deals for the end consumer, mostly at minimal cost, if you know how to access them and can act quickly!

In the main, these products have only been available via Mortgage Brokers and financial intermediaries. Lenders have been re-installing their faith in this distribution medium over the last few months. This is also backed up by recent figures from the Council of Mortgage Lenders showing that brokers accounted for 63% of first-time buyer mortgages, 60% of remortgage loans and 53% of home mover loans in Q1 2011. Whilst some attractive rates are being offered by the high street lenders, there may also be a better option from a lesser known provider. Simply put, the best way to find these is to speak to an independent mortgage brokerage which has access to the ‘whole of market’.

Finally, following on from the above, the sun is shining and the remortgage market is well and truly open – some lenders are actively looking for business. Now is a superb time to review your current mortgage and possibly obtain a great rate with minimal (if any) costs to change your mortgage. Whether you want to fix your monthly payments for a period of time, or you fancy a low rate tracker mortgage, or maybe both - a tracker rate with the option to fix later on, there are plenty of great products currently available. If you are in any doubt, speak to a mortgage adviser, get a free mortgage review and you may not miss out on some great offers before they are gone. It’s good to talk..

10 June 2011

Know what's right..

You may have noticed that I have not had a rant for a while, but as it appears that some underhand activity appears to be starting up again I feel obliged to highlight these to both sellers and purchasers alike.

We have had customers approach us recently advising that, when they are ready to make an offer on a property, the Estate Agent has refused to forward the offer to the vendor unless the proposed purchaser obtain their mortgage facilities via the Agents own internal mortgage consultant!

This is not good for so many reasons including the main, it’s wrong! In addition, the vendor wants to sell the property and is not really concerned about which provider arranges the mortgage for their purchaser!

No one is disputing that the proposed purchaser must prove their ability to obtain finance, where applicable. Nor do I argue with the selling Agent’s right to offer their services, as competition is a healthy thing. However, the purchaser must retain the right to decide for themselves who provides their mortgage finance.

The National Association of Estate Agents (NAEA) is the UK's leading professional body for Estate Agents. Most of the independent Agents in Horsham are registered with the body and adhere to the code of conduct - The Property Ombudsman Code of Practice for Residential Sales. Section 6 states:

By law you must not discriminate, or threaten to discriminate, against a prospective buyer of the seller’s property because that person declines to accept that you will (directly or indirectly) provide services to them. Discrimination includes – but is not limited to – the following: - making it a condition that the person wanting to buy the property must use any other service provided by you or anyone else - failing to tell the seller of an offer to buy the property.

Purchasing a home is probably the largest monetary event you will ever incur and you need to be 100% happy in all aspects of the whole transaction. For more information, go to www.naea.co.uk and see if the Agent you are looking to use is subscribing to adhere to these rules and regulations.

Finally, beware, as not all Estate Agents internal mortgage consultants can offer ‘whole of market’ mortgages. Make sure you ask the question! If you’re not being offered ‘whole of market’ and instead are being offered mortgage products from a ‘limited panel of lenders’, you may be missing out on the best product available to you.

02 June 2011

Mortgage Business Expo - Positive!

Last week, I visited the Mortgage Business Expo (MBE) in Manchester. MBE is the mortgage industry’s leading exhibition where lenders, mortgage distributors, solicitors, and the like, advertise their wares to visiting mortgage brokers and intermediaries. The exhibition, which is usually held in London, has recently expanded to Manchester.

As well as exhibition stands, there are also seminars from industry leaders, trade bodies and regulators. What was apparent was the huge number of visitors in attendance and the very buoyant mood fulfilling the event. Although all seem to agree that lending volumes in the mortgage market will still be relatively small for this year, there was some anticipation from a lenders debate/seminar that volumes will increase next year. Especially after the government has recovered the funding (due early 2012) that was lent out to some Banks via the Special Liquidity Scheme.
This could be good news and would be great for first time buyers.

Despite a lot of positive news in this sector of late, a recent survey by the Yorkshire Bank has revealed that 84% of first-time buyers rely on financial support from their parents in order to purchase their first home. The figure has more than doubled since 2005, when just 38% of first-time buyers relied on the ‘bank of mum and dad’. As reported previously, some lenders are now offering mortgages to those with just a 5% deposit. A huge step forward since just 12 months ago and nearly all lenders are now actively looking to help first time buyers get on the property ladder.

Finally, it can be tempting to take up the offer of a ‘payment holiday’ from your lender. This usually allows a period of time (1 – 6 months) in which no mortgage payment is made. Although this can be an attractive offer, usually this will show as ‘no payment made’ on your credit report and more importantly, may extend the term of your mortgage repayment and increase the interest payable. Always make sure you read and understand the small print before taking any action. If in doubt, seek professional advice.