Expert Knowledge & Professional Service

It has been a busy morning at NatWest for Intermediaries with the bank announcing a host of cheaper mortgages, a new guarantor affordability scheme, and larger loan sizes.

NatWest has launched the 'Family-Backed' mortgage deal, which enables eligible customers to apply for a mortgage with the support of a family member or friend. The bank has also revised its affordability stress test for all mortgage customers.

The "Family-Backed" product, which is also known as joint borrower sole proprietor (JBSP), aims to “boost the amount a customer” can borrow, as the borrower’s income and the income of a family member or friend are used for affordability.

How much can applicants borrow with NatWest's 'Family-Backed' mortgage?

As an example, a first-time buyer with a £28,000 salary and 10% deposit can borrow up to £124,250 on the lender’s existing products. This means they can afford a property of up to £138,000.

With the Family-Backed mortgage, if a borrower’s salary were combined with a family member or friend’s salary of £45,000, this would increase the borrowing potential to around £246,000, upping the property budget to £273,000.

NatWest stated that the family member or friend would be required to obtain independent legal advice before entering into the agreement. This is because they will not be able to borrow as much as they want to take out a mortgage. 

NatWest eases affordability rules so a typical family can borrow £33,000 more

The bank added that it had also changed its affordability stress rates for all mortgage customers “in a further boost to prospective buyers”.

It said the changes to the stress rates mean a typical family can borrow up to £33,000 more, but the stress rates would still “guard against future interest rate rises”. NatWest is the latest high street lender to revise its stress rates to boost borrowing power, with HSBC, Santander, and Halifax having made similar moves earlier this month. 

NatWest said it wanted to “ensure customers have confidence that they can afford their mortgage over the long term”. This is in response to the FCA’s call last month for lenders to design their affordability rates to best meet their customers’ needs, in a market where interest rates are declining.

Aaron Strutt, product director at Trinity Financial, says: "Many lenders now offer Joint Borrower Sole Proprietor, but not all of them allow a friend to be added to the application."

Call Trinity Financial on 020 7267 9399 to secure a mortgage, book a consultation, or complete our mortgage questionnaire. 

The information contained within was correct at the time of publication but is subject to change.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage

Banks and building societies have been busy lowering their rates over the last week, and there is now a selection of lenders offering sub-4% rates.

My mortgage of the week is a three-year fix from Nationwide for Intermediaries. It is available for mortgages between £25,000 and £2 million. While mortgage rates are expected to come down and the Bank of England base rate is likely to get cheaper, there are no guarantees, especially with so much global instability. 

Nationwide's 3.94% three-year fix is only marginally more expensive than the most competitively priced rates, so it seems like a good choice, especially for more risk-averse borrowers who want slightly more payment security than a two-year fix offers.

The building society has a good reputation for issuing fast mortgage offers and typically offers its customers good retention rates when it's time to remortgage.

Details include:

• Residential rate - for property purchases 
• Initial rate - 3.94% - How much will it cost?
• Fixed for 36 months
• Deposit - 40%
• Lender's standard variable rate - currently 7.24% 
• Arrangement fee - £999
• Early repayment charges - Yes

The APRC applicable on this loan is 6.6%. The actual rate available will depend on your circumstances. Please ask for a personalised mortgage illustration. The mortgage is available on an interest-only and capital repayment. 

Nationwide for Intermediaries has recently lowered its mortgage rates and is now offering two-, three-, and five-year fixes at rates below 4%.

Nationwide is the UK's largest building society, and it has launched two and five-year fixes at 3.89%, with the three-year fix still below 4%. 

These mortgages are available to borrowers with a 40% deposit who are buying a property and need to raise between £300,000 and £5 million. There is a £1,499 arrangement fee, and early repayment charges apply. The lender also has a sub-4% five-year fixed remortgage rate.

Aaron Strutt, product director at Trinity Financial, says: "If you are on the hunt for a mortgage there are some great options to choose from at the moment. It was not long ago that it looked like rates were going up, but now we have a range of lenders offering sub-4% fixes.

"While the lowest rates are available to borrowers with a 35% or 40% deposit, the fixes with a 30% or 25% deposit are not much more expensive. Lenders are working hard to attract borrowers, especially now that the stamp duty rate has been increased.  

Nationwide representative example: A capital and interest mortgage of £300,000 payable over 30 years, initially on a fixed rate basis at 3.89% for 24 months and then the standard variable rate currently at 7.24% for the remaining 28 years. The 3.89% rate would require 24 monthly repayments of £1,413.29 followed by 336 payments of £2,010.09. The total amount repayable would be £710,823.20 made up of the loan amount, plus interest (£409,309.52) and £1,499 (product fee), £65 (final repayment charge), £15 (completion fee). The overall cost for comparison is 6.9% APRC representative.

Should you take a two, three or five-year fix mortgage? 

The price difference between the two-, three-, and five-year fixes is currently minimal, with some lenders offering their lowest rates to borrowers opting for two-year fixes over five-year fixes. Longer-term fixes are typically less expensive than two-year rates.

With the money markets predicting at least three Bank of England base rate reductions this year, there is a fair chance that mortgage rates could come down, and cheaper fixed-rate options may become available. However, things change very quickly in the mortgage industry so if are planning to stay in your property for the foreseeable future then it may well be worth taking a five-year fix, if you think the Bank of England will need to act to sure up then economy and lower rates to stimulate the property market, then a two-year fix may be best for you.  

Call Trinity Financial on 020 7267 9399 to secure a mortgage, book a consultation, or complete our mortgage questionnaire. 

The information contained within was correct at the time of publication but is subject to change.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage

Is it really possible to get a mortgage offer in a day? or a week?

Yes, getting a mortgage offer in a day—and more commonly within a week or two—is possible. Still, super fast mortgage offers heavily rely on a few key factors, including the application's complexity, the lender's risk level and an automated property valuation.

M-Powered is branding itself as the Home of the One Day Mortgage

M-Powered has built the "Home of the One Day Mortgage" system, which says it gives 96% of lending decisions within 24 hours once fully packaged applications are submitted.

Trinity Financial's brokers regularly tell surprised and happy clients that their mortgage offer has been produced in a day. However, these offers tend to come from the same lenders, like Barclays for Intermediaries and Nationwide for Intermediaries. 

Getting a Mortgage Offer in a Day

This is uncommon but possible with specialist lenders, mainly big high street banks, and building societies.

They tend to be for borrowers with:

• Very simple applications (e.g., remortgaging with the same lender, low loan-to-value, strong income). However, we have recently had one-day first-time buyer mortgages agreed.
• Pre-qualified clients with all documents ready so they can be submitted once an agreement in principle is agreed. 
• Automated valuation models (AVMs) instead of physical surveys.

Getting a Mortgage Offer in a Week

You’re using a broker, like Trinity Financial, who knows the lenders and their acceptance criteria well

• All required documents, including payslips and (company info, director ID, accounts, SA302s, etc.)
• A desktop or automated valuation is accepted when a computer program assesses the property rather than a proper valuer.
• You’re borrowing at a conservative LTV (e.g. under 65%).

What is M-Powered Mortgages?

An award-winning prime residential mortgage lender who uses smart technology to make "the experience of getting a mortgage fundamentally better for everyone." The lender is backed by Citi, Barclays and M&G Investments.

How long is it taking for the big lenders to produce a mortgage offer on average? 

Call Trinity Financial on 020 7267 9399 to secure a fast mortgage, book a consultation, or complete our mortgage questionnaire. 

The information contained within was correct at the time of publication but is subject to change.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage

HSBC has eased the stress test calculations it uses to determine how much applicants can borrow for a mortgage, meaning some first-time buyers will be able to borrow an additional £39,000.

In a move that could enable 20,000 more customers to get a mortgage with HSBC UK, alongside being able to borrow larger amounts as part of a mortgage, the bank is making changes to its stress rates used in the affordability calculations.

These changes come into effect immediately, with mortgages received from 22nd April being subject to the new stress rate calculations. The changes will benefit both customers purchasing or remortgaging a property.

With stress rates being an integral part of ensuring mortgage affordability for each application, reducing the rate at which a mortgage is calculated will broaden access to homeownership, helping individuals and families including first time buyers with home-buying aspirations. Where offers increase for first time buyers, the average increase in offer will be £39,000.

HSBC is the third large lender to announce it is offering more generous loan sizes following similar moves by Halifax and Santander for Intermediaries. 

Oli O’Donoghue, HSBC UK’s Head of Mortgages, said "We understand the challenges faced by people looking to secure a mortgage. This adjustment to our stress rates, which will directly improve affordability for many aspiring homeowners, reflects our commitment to making homeownership more accessible. By carefully reviewing our affordability calculations, allowing more customers to meet affordability criteria and potentially access increased borrowing amounts, we are aiming to ease some of the pressure on prospective buyers so more people can realise their dream of owning their own home.”

The current combination of lower mortgage rates and more generous loan sizes is good news for many borrowers planning to get on the property ladder this year. 

Call Trinity Financial on 020 7267 9399 to secure a mortgage, book a consultation, or complete our mortgage questionnaire. 

The information contained within was correct at the time of publication but is subject to change.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage

Nationwide for Intermediaries, NatWest and Halifax are the latest major lenders to reintroduce sub-4% fixed-rate mortgages, joining other banks such as Santander and Barclays.

Halifax has made rate reductions on its homebuyer and remortgage products including a sub-4% two-year fixed rate. Both NatWest and Halifax offer two-year fixed rates priced below 3.95%, available to borrowers with a 40% deposit, and each has a £999 arrangement fee.

NatWest has made numerous rate reductions across its fixed and tracker products. Although some fixed deals have seen cuts of 0.26%, one of the options to see its position improve the most has seen a smaller reduction of 0.13% and this is the five-year deal for borrowers with a 25% deposit. 

Halifax has also trimmed the price of its five-year fixed rate, available for those with a 20% deposit by up to 0.21%. It has also lowered its two-year fixed rate, available for borrowers with a 5% deposit by 0.19%.  

Nationwide’s lowest rates are available for mortgages between £300k and £5 million. It is good to see the society offering two, three and five-year fixes below 4%.

Aaron Strutt, product director at Trinity Financial, says: "The lenders are trying to get the property market moving again, especially now that they have been given the green light to offer more generous loan sizes by the government, and the Donald Trump effect has helped to reduce the cost of fixed rates.

"Many of the new cheaper sub-4% rates are available to borrowers buying a home rather than remortgaging, and this makes sense now that stamp duty is so much more expensive for many buyers. The recent affordability improvements by Halifax, Santander, and now HSBC will make a difference to many borrowers who cannot get a sufficiently large mortgage."

Call Trinity Financial on 020 7267 9399 to secure a mortgage, book a consultation, or complete our mortgage questionnaire. 

The information contained within was correct at the time of publication but is subject to change.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage