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A busy week of mortgage rate changes
A host of mortgage lenders have changed their rates this week, including some of the biggest: Abbey, Alliance & Leicester and Northern Rock.
Northern Rock have removed their market leading two-year fixed rate available only through brokers, as they try to slow down lending. Northern Rock’s lowest fixes now start at 3.89%.
Every so often the Coventry Building Society launch market leading rates and we are now seeing this happen again. They now offer a two-year fixed rate at 3.50%. However, borrowers will need to have a 50% deposit. One deal that will appeal to people looking to buy a house is their marketing leading two-year base rate tracker at 2.59% – for those with a 30% deposit. Both of these mortgages have a free property valuation and an arrangement fee of £999.
Longer term fixed rate mortgages continue to get more expensive or are simply removed. Abbey have removed some of their four-year fixed rates from their product range. Four-year rates now start at 4.89%.
The lowest five-year fixed rate is available from the Newcastle Building Society at 4.99%. There is an arrangement fee of £994 and potential borrowers would need a 25% deposit. This is one of the best deals available in the market.
One mortgage Trinity Financial does still have access to is Abbey’s existing current account holder rate. This two-year fixed mortgage rate is an excellent 3.59%. It is available to borrowers with a 30% deposit. Abbey, or Santander, as they will be known as next year, are particularly keen to gain current account business. So many of the mortgage rates we will see in the future will come with the condition that you switch your current account to them. Abbey sees this as an excellent way of raising funds without going to the money markets.
November 27, 2009.
Low buy-to-let rate available
Many of the lowest buy-to-let mortgage rates are accompanied by percentage based arrangement fees which can be as high as 3.5% of the loan amount. Trinity has access to mortgages that are linked to LIBOR rate. This means that we can arrange mortgages for buy-to-let investors at 2.75% over LIBOR, which would currently have a pay rate as low as 3.3375%.
The arrangement fee attached is one of the lowest in the market at 1.25% of the loan amount. Investors would need a 40% deposit to access this rate and it may also be possible to lend to limited companies.
November 27, 2009.
Near prime mortgage launched
Kensington Mortgages has announced that they are coming back in to the mortgage market with a two-year fixed rate at 5.69%. Aaron Strutt, a broker at Trinity Financial Group, says: “This two-year fixed rate may seem high and with its £1,299 arrangement fee be pretty uncompetitive, but it is not designed to compete with the high street lenders.
“Kensington say that applicants will not be credit scored. They will be credit searched instead. Some borrowers are refused a mortgage because there credit score is not high enough, and this can be for a number of reasons, such as a lack of credit history. Kensington will credit search applicants to make sure that they have not had any CCJ’s or missed mortgage payments in the last two-years.
“For borrowers that have not been able to get a mortgage from the high street banks, it could be worth trying Kensington. We have access to this exclusive deal.”
November 26, 2009.
More exclusive rates available to Trinity Financial Group
A year ago there were virtually no mortgage lenders offering exclusive rates via brokers. But we have now seen the market change and it is now slightly more normal. Alliance and Leicester have today launched two lifetime tracker mortgages. The lowest rate is down at 2.89% with a £495 arrangement fee and there is also the option of a fee free mortgage at 2.99%. Both deals require a 30% deposit.
Northern Rock may have increased the cost of some of their five-year fixed rates from 4.99% to 5.39%. However, they have not changed the two-year fixed rate through Trinity Financial. Those looking to buy a property can still fix for two-years at 3.65% and anyone wanting to remortgage may still be able to swap in to a fixed rate at 3.69%. The arrangement fees are £595 and £995, respectively, and both mortgages require a 30% deposit.
Platform Home Loans, owned by The Co-operative Bank, have a two-year tracker at 2.79%. This deal is unique because it has a 1% minimum base rate. The Bank of England base rate would have rise by 0.5% before the pay rate would rise. A 30% deposit is required and there is a £995 arrangement fee.
One further fixed rate we have access to is available only to existing Abbey current account holders. The rate is fixed for two-years at 3.59%. There is a £995 arrangement fee and a free property valuation and legals service if you want to remortgage. The maximum loan is £1 million and you will need a 30% deposit.
20th November 2009
Gross mortgage lending up 5% in October
October’s gross mortgage lending was an estimated £13.5 billion, a 5% rise from £12.9 billion in September but down 27% on £18.5 billion in October 2008, according to the Council of Mortgage Lenders (CML). This is typical seasonal activity between September and October. The average monthly rise over the last decade has been 5%.
The October figures are in line with the CML’s forecast for gross lending of around £141 billion for 2009 as a whole.
20th November 2009
Abbey and Alliance & Leicester cut rates
Abbey and Alliance & Leicester, both part the Spanish bank Santander, have once again cut the cost of their mortgages. This will be the 37th time this year that Abbey have made changes to their mortgage rates.
The latest rates came in to effect yesterday. Alliance and Leicester launched an extremely low Bank of England base tracker rate at 1.99%. This mortgage does have a 2% arrangement fee but, for borrowers looking to keep monthly mortgage costs to a minimum, it could be very attractive. There is free property valuation and the mortgage is fully-flexible. Those looking to secure this mortgage will need a 30% deposit.
Nici Audhlam-Gardiner, Director of Mortgages at Abbey and Alliance & Leicester, said: “Our strong third quarter results show an estimated market share of 20.5 per cent.
“In October, we saw a 50% increase in our applications from home purchasers, versus the average monthly figure for the first half of 2009 and home purchase applications now account for 67 per cent of our total monthly applications. This is very encouraging and shows home buying is on the up. Our own research revealed that it’s now cheaper to buy than rent in all regions of the UK, except London.”
Abbey are still offering their Homebuyer Plus mortgages. These provide a free property valuation and free solictors. Rates are very competitive: a two-year tracker starts at 3.19% and a two-year fix at 3.99%.
November 13, 2009.
First-time buyers escaping Stamp Duty
One third of first-time buyers escaped paying Stamp Duty in September as a result of the government’s temporary £175,000 nil-rate threshold, according to figures released by the Council of Mortgage Lenders.
There were 6,200 first-time buyer loans for properties between the old threshold of £125,000 and £175,000, representing 32% of the 19,700 loans for first-time buyers in September. In addition, 7,800 first-time buyers (40%) bought properties valued below the £125,000 original threshold.
Since the concession was introduced, an estimated 132,500 house purchase mortgage transactions have escaped paying stamp duty which otherwise would have incurred the tax at 1%.
The Stamp Duty reprieve is due to end on the December 31, 2009.
November 13, 2009.
Mortgage rates cut again
Mortgage lenders have continued to cut the cost of their mortgages this week, in particular two-year base rate trackers. Nationwide, Abbey and Alliance and Leicester have all made reductions. The largest cut was by Northern Rock. Their two-year tracker mortgages were reduced by up to 0.5%, ensuring they remained at the top of the best buy tables.
Aaron Strutt, a broker at Trinity Financial Group, said: “Northern Rock’s lowest rates were previously available only to those purchasing a property, but they have now stopped this unfair practice with their base rate linked mortgages. Their lowest two-year tracker is now 2.59% for those with a 30% deposit. The maximum arrangement fee is £995.”
“Abbey have cut the gap between themselves and Northern Rock. They now offer a two-year tracker rate at 2.69%. Their is a £995 arrangement fee and borrowers must have a 30% deposit. Abbey will also provide a free property valuation – free legals if you are remortgaging – and £250 cash back if you are buying a property.
“Fixed rates mortgages have remained pretty stable over the last few weeks. The lowest two-year fixed rate is 3.65% for those with a 30% deposit and this mortgage has a maximum arrangement fee of £995. This is an exclusive deal available though Trinity Financial Group. The lowest five-year fixed rates start at 4.99%.”
Northern Rock, the nationalised bank, said this week that they were now on course to hit lending targets for the year. Their mortgage lending had increased by £1 billion in the third quarter, taking its total lending in 2009 to £2.3 billion. One slightly disappointing statistic, especially for first-time buyers, was that the average loan to value on new mortgages was as low as 55%. Borrowers wanting a Northern Rock mortgage with a 15% deposit will need an excellent credit rating to meet the bank’s lending criteria.
November 06, 2009.
More buy-to-let mortgages
There are now more mortgage lenders coming back in to the buy-to-let market and more mortgages available.
Investors will need at least a 30% deposit to access the lowest deals. The most keenly priced mortgages are available through lenders such as The Mortgage Works and Birmingham Midshires. The Whiteaway Laidlaw Bank (owned by the Manchester Building Society) also has some very attractive mortgages which start at 4.79%.
Trinity Financial has access to buy-to-let lenders which are linked to LIBOR, the rate at which banks lend to each other. With three-month LIBOR currently at 0.60%, we can access margins at 2.75% over LIBOR. Arrangement fees are as low at 1.25% and penalties for repaying the loan within the first two-years are just 1%.
06 November 2009
Base rate stays at 0.5%
The Bank of England Monetary Policy Committee voted yesterday (November 5, 2009) to hold base rate at 0.5%. The last Base Rate change was a 0.5% reduction on March 5, 2009. The committee announced that their program of asset purchases through issuing central bank reserves would increase by a further £25 billion to £200 billion. The program will take three-months to complete.
In a press release issued by the Bank of England yesterday, the bank said that the world economy has shown signs of recovery and that this was demonstrated through the number of emerging markets rebounding strongly in growth. They went on that say that the bank’s funding conditions have improved, but financial conditions remained fragile.
The Committee felt that, in order to meet the 2% inflation target in the medium term maintaining Base Rate at 0.5% was appropriate. Currently, inflation stands at 1.1%.
06 November 2009
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