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No surprise last week that the base rate was put on hold – in fact it passed with little comment. I had been invited this week to a mortgage strategy summit with the top players within the mortgage industry (to my surprise). It was a bit like the G20 summit but for mortgage brokers, and it has given me a fantastic insight into the current state of the market from both a lender’s and broker’s perspective.
If I can summarise 2 days into 30 seconds, then I would as follows: - Don’t expect any new lenders coming into the market for the next 2 to 3 years.
- Loan to values will not increase until the market stabilises.
- General consensus is that property values will bottom out within the next few months
- Once properties have stabilised lending criteria should ease.
I’m not sure there were any particular surprises within this list. However the overall mood was that the worst had been avoided and it would be a steady climb back up the hill. Tip of the week again – Want to cap your mortgage payments? Are you concerned about what interest rates may do in the next couple of years? If so then read on: If you had the chance to: 1. Cap your current variable rate at just 2% above your current rate – in other words if rates rose beyond 2% you wouldn’t pay anymore than the initial 2% rise. 2. Have no legal or valuation fees and no credit searches. 3. No minimum loan to value – in other words even if you were in negative equity you could have this capped product. 4. Pay an arrangement fee of no more than 1.5%. · You can use this for buy to let, residential and commercial. · For just one or all of your properties. · Use it to hedge interest rate rises across your portfolio. Well, we do have such a product available. It’s certainly not for everyone (eg you cannot raise any extra capital) but call us on 01424 205 373 and we can explain how many investors are using this product right now. Call one of our advisors today for more information 01424 205 373 Good hunting! Your Resident Broker John |