Homeowners are not as well off as tenants
August 5, 2008 by admin
Filed under News, News-Mortgages
Over the past year the benefits of owning a home as opposed to renting one have plummeted by 75% according to a recent report. This means that in many parts of the country people that are renting a home are actually better off than those that have bought their own home. According to the report tenants are actually faring better than homeowners in around 50% of the country’s regions.
This information was put together by the Abbey Bank in its latest Rent V Buy Index. The data indicates that those purchasing their property rather than renting a property saved around £24,000 last year. However, this year the figure has dropped dramatically to just £5800. Abbey official claim that this situation has been caused by rising property prices and sky high interest rates, which has resulted in rising costs for homeowners that have not necessarily affected those that rent.
As part of the study twelve regions were studies, and out of these it was found that tenants were better off than homeowner in six of the regions. The Abbey made these calculations based on a 90% LTV mortgage at an interest rate of 6.5%. Essential home maintenance costs were also taken into account in the survey. Read more
Tags: mortgage, renting a property, interest rate, LTV, homeowner, Renting, Abbey Bank, home maintenance
100% plus LTV mortgages set to grow in popularity
July 18, 2007 by admin
Filed under News, News-Mortgages
The 100 per cent mortgage market is set to grow, according to industry experts.
Brokers were polled by Alliance & Leicester, which reveals today, with 78 per cent predicting that increasing amounts will be taken out in future.
Almost three quarters said that they had already advised clients on the product, which is at present only offered by five lenders.
Mortgages of 100 per cent or more LTV (loan to value), the purchase of which means that no lump sum or deposit need initially be paid, might prove especially popular with first-time buyers.
Jeremy Claridge, head of specialist mortgages at Alliance & Leicester, said: “We are pleased to see that most brokers predict this market will grow within the next two years as these products offer a great opportunity for borrowers who need some additional funding.
“The mortgage market is continually changing and there is an ever-growing need to find more flexible products to allow people to get on the housing ladder or to manage their existing borrowings in a better and more efficient way.”
The rise in popularity could be seen as a consumer response to runaway increases in house prices. The latest government figures, released earlier this week, show that the average house in London was almost 15 per cent more expensive than this time last year.
The data also revealed that the overall year-on-year inflation rate for house prices stood at 10.9 per cent.
John Charcol unveils buy-to-let mortgage brace
April 4, 2007 by admin
Filed under News, News-Mortgages
Mortgage broker John Charcol has launched two new tracker mortgages for buy-to-let investors, with rental cover requirements which are “not too onerous”.
One of the John Charcol mortgages possesses a 90 per cent loan-to-value (LTV) rate and will track the Bank of England base rate at plus 0.74 per cent for the term.
No early repayment charges apply and rental cover of 100 per cent is also applicable to the deal.
The group’s other package has a maximum LTV rate of 85 per cent and is available to both new purchasers and remortgagers.
Its rate is set at the Bank of England base rate plus 0.39 per cent, with the fee for the package set at £999.
Ray Boulger, senior technical manager at the broker, said that with gross rental yields on many other packages seriously restricting choice, the two mortgages “have been designed with rental cover requirements that are not too onerous”.
He added: “For most buy-to-let investors the choice for the best value mortgage tracker is now primarily between taking out a cheaper two-year tracker, with a view to continuing to take up a new deal every two years, or securing the convenience of a lifetime tracker at a slighter higher rate.”
