Mortgage News
Building societies withdraw mortgages to manage demand
Two large building societies have temporarily withdrawn nearly all of their residential mortgage rates via brokers to enable them to control lending volumes and case processing times.
Skipton Building Society sent an email to brokers explaining that they have started 2012 unbelievably well and that in January they were pushing at 150 per cent of their forecasted lending.
Accord Mortgages pulled their mortgage rates to concentrate on managing the applications that they already have, rather than causing borrowers unexpected delays.
Aaron Strutt, a broker at Trinity Financial, says: “It is unusual for a lender to withdraw all of their mortgages because they are so far ahead of their lending targets.
“Accord and Skipton have said that they will come back to the market with new rates shortly, but other lenders have also been busy. Halifax and Northern Rock increased the cost of their mortgages to manage application levels.”
If you are looking for a quick mortgage offer, Trinity Financial will submit your application to a lender with good rates and efficient processing times.
One of the most competitive mortgages that we have access to is a term tracker rate at 2.80%. The maximum loan-to-value is 80% and the arrangement fee is £1,295. For mortgages over £500,000 the arrangement fee increases to £2,495 and there are early repayment charges of 1% for the first 12 months.
February 17, 2012
Confidence reaches its highest level for five months in January
After ending 2011 close to all-time lows, consumer confidence staged a modest recovery at the start of 2012, picking up by nine points to 47.
According to Nationwide Building Society’s Consumer Confidence Index for January, confidence remains subdued by historic standards. Their Index for January is almost 30 points below the long-term average.
Robert Gardner, Nationwide’s chief economist, said: “Given the challenging economic backdrop, with the UK economy contracting in the final quarter of 2012 and the unemployment rate rising to its highest level since 1995 in recent months, the improvement may prove to be a little more than a temporary bounce.
“However, a number of other economic indicators have also surprised and been more positive than expected in recent weeks, which may be an indication that underlying economic conditions are not as weak as feared.”
Consumers expressed a greater propensity to spend on household goods in January with 40% of people believing it to be a good time to buy. This is up from 31% in December and has now reached its highest point since the introduction of the 20% VAT rate a year ago.
February 17, 2012
Lloyds makes changes to interest-only mortgage qualification criteria
Lloyds Banking Group has made substantial changes to their interest-only mortgage qualification criteria.
It is now more difficult to qualify for interest-only and any borrowers unable to meet the tighter criteria will be asked to take a capital-repayment mortgage.
The new lending criteria now states that pensions included into the mortgage calculations must have a minimum current value greater than £1 million and up to 25% of the current fund value can be used to support interest-only lending.
Cash savings are no longer accepted as a repayment vehicle for interest-only.
Febuary 17, 2012
ASA ban NatWest and RBS advert
The Advertising Standards Authority has upheld a complaint against two television ads for NatWest and Royal Bank of Scotland.
A councillor and the Campaign for Community Banking Services successfully challenged the banks “last bank in town” advert on the basis that some branches had substantially reduced opening hours, or have been replaced by visits from a mobile bank.
February 17, 2012
Moody’s may cut 17 banks’ credit ratings
Moody’s, the credit rating agency, has warned that it may cut the credit ratings of 17 banks, including Morgan Stanley, UBS and Credit Suisse. Nine of the banks are based in Europe and include Barclays, HSBC and Royal Bank of Scotland.
Alexander Potter, banking specialist at Berenberg Bank, told the BBC that the riskiness of these banks has already been reflected in prices for the banking sector on the credit default swap market for some time.
Mr Potter is quoted as saying: “This follows a similar review by S&P and credit spreads highlight the fact the market is already, in most cases, well ahead of the slow-moving ratings agencies.”
February 17, 2012
Santander reduces interest-only LTV to 50%
Santander and Abbey for Intermediaries have reduced their maximum loan-to-value for interest-only mortgages from 75% to 50%.
Under the bank’s new criteria, individuals will be able to borrow only a maximum of 50% of the value of their property on an interest-only basis. Anyone borrowing above this loan-to-value will have to take a full capital-repayment mortgage.
Aaron Strutt, a broker at Trinity Financial, says: “Santander’s policy change is one of the toughest yet and they have gone much further than the handful of lenders that make first-time buyers take their mortgages on a full capital repayment basis.
“I have spoken to some of the bigger lenders and they are surprised at Santander’s new stance, especially as they have always been happy to lend on interest-only. They don’t expect to follow Santander’s lead, but they can’t rule it out.”
Banks and building societies have tightened their interest-only lending criteria after the Financial Services Authority expressed concerns as part of its mortgage market review.
According to the FSA, approximately 75% of borrowers who took out an interest-only mortgage in 2007 had declared no repayment vehicle.
February 10, 2012
Number of buy-to-let properties increases by 84,000 in 2011
The number of properties being bought with buy-to-let mortgages increased to 84,000 in 2011, according to data from the Council of Mortgage Lenders.
During the fourth quarter of 2011, a total of 34,800 buy-to-let mortgages were advanced with a total value of £4bn.
Paul Smee, director-general of the CML, says: “Buy-to-let continues to perform well. Demand for rented property remains high, so the rationale for buy-to-let remains strong and there is little reason to foresee any change to this positive outlook for the sector.”
Buy-to-let mortgages account for nearly 13% of the total outstanding value of mortgages in the UK.
February 10, 2012
Bank of England injects another £50bn into UK economy
The Bank of England’s Monetary Policy Committee (MPC) has voted for more quantitative easing (QE) and will increase the size of its asset purchase programme by £50bn.
The aim is to give a further stimulus to the UK economy and this will take the QE programme to a total of £275bn.
The MPC also said that it would keep interest rates on hold at 0.5%.
February 10, 2012
Rising discounts on asking prices
More than a third of UK properties currently for sale have had their asking prices lowered at least once, according to property website Zoopla.co.uk.
The average discount available off of property now is £19,580, or 7.5%.
The average discount is more than £1,000 higher than this time last year, with the biggest discounts in Glasgow (9.2%), Blackpool (9%) and Maidstone (8.5%).
February 10, 2012
Repossessions at lowest level since 2007
The number of properties taken into possession in Q4 2011 totalled 8,500, 5% higher than the 8,100 home repossessed in the same period in 2010, according to data from the Council of Mortgage Lenders.
Low interest rates and good arrears management by lenders helped to keep repossessions figures low.
The number of properties repossessed in 2011 as a whole was 36,200, down from 37,100 in 2010.
February 10, 2012
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To get a free mortgage quote, or arrange a meeting with one of our expert advisers, call Trinity Financial on 020 7520 9427. Alternatively, enquire using our online form or send an email to enquiries@trinityfinancialgroup.co.uk
Trinity Financial is a trading name of Jed Newton and Vestprop Financial who are appointed representatives of Intrinsic Mortgage Planning Limited, which is authorised and regulated by the Financial Services Authority. Intrinsic Mortgage Planning Limited is entered on the FSA register (http://www.fsa.gov.uk/register/) under reference 440718.
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