Latest Mortgage News

August 7, 2008

Base rate on hold at 5%

by Gill Montia
The Bank of England's Monetary Policy Committee (MPC) has voted to keep the base rate on hold at 5% in August. While mortgage borrowers will be relieved at the news, it is unlikely to have an impact on the decline in UK house prices, which according to Halifax slid 1.7% last month, taking annual house price deflation to 10.9%, or 8.8% ...

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August 6, 2008

Rate cut round up

by Gill Montia
This week has seen a round of rate cuts from High Street lenders, as competition appears to be returning to the market. Royal Bank of Scotland and NatWest have announced interest rate cuts of at least 0.10% on their new fixed and tracker mortgages, while rates on some other deals are being reduced by up to 0.30%. Abbey is making itself attractive to new borrowers ...

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Persimmon and Halifax promise to double deposits

by Gill Montia
Persimmon has joined forces with Halifax to help first-time buyers enter the property market. The housebuilder's "double your deposit" scheme does exactly what it says as long the funds are used to buy a new Persimmon home. To participate in the offer, a would-be homeowner needs to make regular deposits of up to £5,000 into a savings account with Halifax or Bank ...

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August 5, 2008

FSA warns lenders as repossessions rise 41%

by Gill Montia
The Financial Services Authority (FSA) is reminding mortgage lenders of their obligation to treat customers fairly. In a recent review, the regulator found weaknesses in the way some lenders have been dealing with arrears and repossessions, particularly for consumers with impaired credit histories. Specialist lenders raised particular concerns for the regulator, which described some firms as operating a "one size fits all" ...

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Negative equity haunts one in five Northern Rock borrowers

by Gill Montia
As the housing market downturn continues, Northern Rock customers are more likely to be facing negative equity than borrowers with other UK lenders. While the number of people in arrears with their mortgage repayments is rising across the banking sector, Northern Rock is more exposed than most of its competitors because prior to the credit crisis, it offered home ...

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August 1, 2008

L&G mortgage club launches two-year tracker at 5.99%

by Gill Montia
Legal & General Mortgage Club is launching a two-year tracker loan at 5.99% (base rate plus 0.99%) on 9th August. The new deal, which is available at up to 75% loan-to-value for new purchases and remortgages, is being provided by Scottish Widows Bank, in its first offering through the mortgage club. The loan carries a £999 arrangement fee, which can be ...

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July 31, 2008

One in seven homeowners could face negative equity

by Gill Montia
Standard & Poor's (S&P) is predicting that one in seven UK homeowners will face negative equity over the coming 12 months. Figures from Halifax and Nationwide in April show a 9% year-on-year decline in UK house prices and the credit rating agency expects a further slide of 17%, over the coming year. Research by CACI shows that around 70,000 ...

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July 30, 2008

Lloyds TSB and C&G cut fixed and tracker rates

by Gill Montia
Lloyds TSB and its mortgage subsidiary, Cheltenham & Gloucester (C&G), are cutting interest rates on two-year fixed-rate and tracker loans. The lenders' full-term tracker mortgages will see the maximum benefit, with rates reducing by 0.38%, to 5.95%. The maximum loan-to-value (LTV) ratio on these deals is 20%. Interest on two-year fixed-rate loans with a maximum 90% LTV come down to ...

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July 29, 2008

New mortgage lending falls 69% year-on-year

by Gill Montia
Latest figures from the Bank of England show that in June, new mortgage approvals fell to their lowest level since the Bank's records began, in 1993. During the month, home loans approved for house purchases fell to 36,000, representing a 69% decline on June 2007 and 12% down on May. Approvals for remortgages also fell, down to 84,000, compared with 90,000 ...

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Mortgage lending will take two years to recover

by Gill Montia
A government initiated report into the UK mortgage market has been published today. The work has been prepared by Sir James Crosby, a former chairman of Halifax, who is heading a review into improving wholesale mortgage funding. Final recommendations will be published in the autumn but in the meantime the report predicts that current funding difficulties will take two years to ...

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July 28, 2008

LV= launches lifetime mortgage

by Gill Montia
LV= (formerly Liverpool Victoria) has launched a new equity release product. The friendly society's Flexible Lifetime Mortgage allows homeowners to draw on the equity in their homes, as needs arise. It also provides a 15-year guarantee on the maximum amount that can be withdrawn, which will be honoured regardless of future trends in UK property prices and interest rates. The plan is open to homeowners aged ...

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July 25, 2008

Halifax and Yorkshire BS cut rates

by Gill Montia
Halifax and Yorkshire Building Society have both announced cuts in mortgage interest rates. From tomorrow, Halifax is reducing rates on 16 products by up to 0.3%. Bank of Scotland, which is also part of the HBOS group, will make cuts across 29 of its home loans. In the case of Halifax, two-year fixed rates are not affected, as these were reduced last ...

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July 24, 2008

Tracker mortgages provide strong competition for fixed-rates

by Gill Montia
Moneysupermarket.com is alerting homeowners to the fact that the average two-year tracker mortgage is offering increasingly good value. The price comparison website's weekly credit crunch monitor shows that at the beginning of June, there was little difference between the cost of the average two-year fix and the average two-year tracker. However, the latest update puts the difference at over 0.5%, in ...

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July 23, 2008

Which? exposes incompetent mortgage advice

by Gill Montia
Which? has been investigating competency among mortgage advisers and has found that many are omitting to check information on clients' abilities to meet repayments. The consumer group sent its researchers to gather advice from banks, estate agents and independent mortgage advisers. Acting as first-time buyers, they visited 24 banks, 13 estate agents and 13 independent mortgage advisers in England and Scotland, between February and ...

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New mortgage approvals decline 66% year-on-year

by Gill Montia
The British Bankers' Association (BBA) has released figures for mortgage lending in June, showing that the number of new home loans approved by the UK's leading lenders fell 23% in a month. In May, BBA members approved 27,499 new home loans but the figure declined to 21,118 in June, representing a 66.9% fall on the same period of 2007. The annual fall ...

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Sub-prime lender offers cash-back on mortgage redemptions

by Gill Montia
One time subprime mortgage specialist, Edeus, has taken the unusual step of offering cash-back to selected customers who redeem their mortgages. The lender closed its doors to new business last year and has been struggling to sell its loans to investors in mortgage-backed securities. Much of the debt is in the sub-prime sector and the market for this is virtually dead. The firm ...

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Mortgage fees rise 20% in a year

by Gill Montia
Research from price comparison website, mform.co.uk, shows that the arrangement fees applied to the most competitive mortgages on the market have increased by an average of 20% during the past 12 months. The average fee paid buy borrowers for a best-buy product has risen from £738.33 in August 2007 to £889.69. For three-year fixed-rate deals the rise is even steeper, with the ...

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July 22, 2008

FSA crack down on mortgage fraud

by Gill Montia
The Financial Services Authority (FSA) has announced that it is cracking down on mortgage fraud, having already banned 17 brokers in the past 12 months. The regulator says it wants to receive more information from lenders who spot suspect loan applications and will be working to improve intelligence sharing across the industry. Lenders have been asked to report suspect mortgage brokers since 2006 ...

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Average two-year fixed-rate drops below 7%

by Gill Montia
Moneyfacts.co.uk has announced that the average interest rate on a two-year fixed-rate mortgage has fallen to 6.96%. Market swap rates have soared in recent months, taking rates on this popular type of loan to a ten-year high of 7.08%. However rates on the two-year and other fixed deals are now falling. In the case of the three-year fix, by 0.12% and on the ...

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Woolwich cuts rates and launches lifetime tracker

by Gill Montia
Woolwich is cutting mortgage interest rates for the second time in two weeks. The lender, which is part of the Barclays group, is reducing the rate on its 10-year fixed-rate deal by 0.32 percentage points, to 5.94%. Rates on three-year and five-year fixes will fall by 0.2% and 0.1% respectively. The move follows rate cuts by a number of lenders in ...

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