Is a variable rate mortgage the right choice for me?

Consumers in the UK can enjoy a choice of mortgage options these days, and no matter what your needs and circumstances there is a good chance that there is a suitable mortgage product on the market for you. When it comes to mortgages consumers can enjoy options such as the standard variable rate, the fixed rate, base tracker mortgages, capped rate mortgages, and more. The most popular of these are the variable rate mortgage and the fixed rate mortgage, both of which offer benefits as well as disadvantages. Read more

Tags: Mortgages, variable rate mortgages, interest, Real estate, United Kingdom, Business Finance, UK mortgage terminology, Floating interest rate

Mortgage market “still buoyant”

The mortgage market is “still buoyant” despite the recent financial crisis due to the amount of remortgage business available, claims one expert.

Despite the market being healthy, Bestinvest said that it is becoming increasingly harder and more expensive to look at remortgaging property. .

Peter O’Donovan, mortgage manager for Bestinvest, said: “There are still plenty of people looking to buy houses, it’s just the cost of doing so, and once again making sure they understand exactly what it is they are entering into.”

Previously a remortgage would only cost a couple of hundred pounds but now the average fee is a £1,000, he added.

According to the Council of Mortgage Lenders, the credit crunch has resulted in funding difficulties for a number of mortgage lenders, reducing their capacity to lend.

Lenders have responded by reappraising the risks involved in lending, resulting in a tightening in lending criteria and a widening in mortgage margins to parts of the market.

Tags: manager, funding, mortgage manager, crisis, UK mortgage terminology, lending, expert, amount

Repayment and interest only mortgages

There are many different mortgages on the market these days, with something to suit most needs and circumstances, but all mortgages come under one of two umbrellas, which are repayment mortgages (also known as capital and interest mortgages) and interest only mortgages. When you are looking for a mortgage you need to decide whether you want to opt for a repayment mortgage, which is the most popular type of mortgage, or an interest only mortgage. Read more

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Mortgage holders in for a ‘rate shock’

Mortgage provider Nationwide has warned homeowners coming off of two year fixed rate deals this autumn that they could be in for a nasty shock as their monthly repayments jump up by £200.

Two years ago, the average fixed rate for a homeowner loan was just 4.56 per cent, but 250,000 homeowners will be seeing their mortgage revert to standard variable rate, which now is an average of 7.65 per cent, more than three per cent what they are currently paying.

Although Nationwide is urging customers to negotiate a remortgage as soon as possible and preferably before their existing deal expires, the average fixed rate is also a lot higher today than it was in 2005. In fact, the increase from 4.56 per cent to 6.41 per cent will still cost customers £110 a month on a £100,000 loan.

“For some borrowers it will come as quite a fright to see their mortgage payments increase dramatically,” said Matthew Carter, director of mortgages at Nationwide. To absorb some of this shock, borrowers need to consider remortgaging as soon as their deal ends, or beforehand if their lender allows it.”

He also noted that there has been growing interest in the bank’s 25 year fixed rate mortgage since the last Bank of England base rate rise.

According to a recent survey by Abbey Mortgages however, less than one in four Britons would consider taking out a 25 year fixed rate homeowner loan.

Tags: UK mortgage terminology, provider, average fixed rate, finance, average, bank, monthly repayments, today

Best Buy-To-Let Mortgages

Here we take a look at the top mortgages for Buy-To-Lets currently available, and some of the advantages and disadvantages. Read more

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No fees please

A new range of mortgages have been launched by a leading building society which come with absolutely no fees.

Yorkshire Building Society has announced the new range with the aim of simplifying the mortgage market for borrowers.

The firm is promoting its range as having no product fees, no legal fees, no standard valuation fee, no money transfer fee and no higher lending charge for re-mortgages.

The leading product in the range is a five-year fixed-rate mortgage at 5.89 per cent but the building society has a large number of deals on offer.

“There has been an inexorable rise in product fees in recent months, as lenders compete to get in to Best-Buy tables with headline rates,” said Yorkshire’s product development manager David Heshon.

“It has become increasingly difficult for customers to work out what the best deal is.

“With this new range of products what you see is what you get – a straightforward rate, with no additional up-front costs,” he added.

Borrowers, particularly those who are venturing into the property market for the first time, are finding it increasingly difficult to find a mortgage that best suits their needs so shopping around for deals such as this can be extremely beneficial.

Tags: money transfer, Valuation, recent months, fee, valuation fee