Demand for five-year mortgages expected to grow
April 9, 2008 by admin
Filed under News, News-Mortgages
The number of homeowners looking for longer-term fixed mortgage deals is set to rocket, a leading bank has reported.
Research by Abbey Mortgage Index has shown that buyers seeking a fixed deal lasting five years have doubled in a month to 24 per cent.
The popularity of two-year fixed-term deals rose by just three per cent to 10 per cent.
This is in contrast to tracker mortgages which only five per cent of borrowers said they would opt for.
Nici Audhlam-Gardiner, director of Abbey Mortgages, said: “Recent reports about the shrinking mortgage market seem to have had a profound effect on borrowers.”
Abbey advised mortgage providers to prepare for a rush on longer term deals as borrowers seek stability amid the credit crunch.
The decrease in the availability of mortgage deals is guiding homeowners towards more lengthy mortgages suggests Ms Audhlam-Gardiner.
“Homeowners faced with a dwindling number of mortgage deals seem keener than ever to lock themselves into a deal for longer than two years such as a five-year fix,” she added.
Statistics by Moneysupermarket.com revealed that mortgage deals have decreased by 60 per cent compared to before the economic slowdown
Rejected mortgage applications rise by 60%
October 17, 2007 by admin
Filed under News, News-Mortgages
In the past six months the number of mortgage applications being rejected has gone up by a staggering 60 per cent.
According to recent research by MoneyExpert.com, the amount of rejections this year has risen from 463,000 between January and March to 738,000 in the last six months.
The increase reflects interest rate rises and more specific lending criteria, the website explained.
Its chief executive, Sean Gardner, commented: “Life is tough at the moment if you’re applying for a mortgage. The financial environment is far more stringent than in the summer of last year and people need to be prepared for rejection.
“Lenders quite reasonably do not want to take risks when there are pressures on how much people can afford.”
Standard and Poor rating agency told the Financial Times newspaper that the mortgage slowdown is due to a “knock” to buyer confidence after the credit squeeze.
It added that mortgage lenders might look to further tighten underwriting standards and pricing on some types of mortgages.
No rise for interest rates
October 4, 2007 by admin
Filed under News, News-Mortgages
The Bank of England has left the UK base rate untouched at 5.75 per cent.
Today’s announcement from the Monetary Policy Committee comes after five consecutive rises since August 2006, each of one quarter of a per cent.
“An interest rate cut was unlikely this month as there are, as yet, few signs of any serious damage to the real economy from the upheaval in the money markets,” said CBI chief economic adviser Ian McCafferty.
Homeowners who faced increased mortgage repayment costs and a recent fall in house price inflation are likley to welcome the news.
The rises in interest rates may have had a direct effect on house price inflation, which fell last month from 11.4 per cent in August to 10.7 per cent in September, according to the Halifax.
Martin Ellis, chief economist at the bank, commented: “September’s price fall is consistent with the normal behaviour of the market during a slowdown.”
Nationwide house price report shows slowdown
July 26, 2007 by admin
Filed under News, News-Mortgages
Nationwide house price report shows slowdown
Further evidence for a rapidly-cooling house price market comes today, with the release of the monthly report from lenders Nationwide.
Seasonally adjusted, house prices made a gain of 0.1 per cent for July – the slowest growth for over a year, and a negation of the gains from the last set of results in June.
The annual rate of inflation is also down, currently standing at 9.9 per cent: numbers had been in the double digits for the last three months.
Nationwide starkly stated that the “risk of monetary overkill” looms large over the housing market.
The lender also welcomed the government’s housing green paper, which proposes that more affordable homes be built; yet “as the recent flooding shows, the challenges ahead are substantial”, it adds.
Many analysts will be surprised by the results, with Reuters reporting that a 0.5 per cent gain and an annual reading of 10.6 per cent had been predicted.
