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alabala

Borrowers Have No Time To Delay

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http://www.ft.com/cms/s/0/1616b43a-f6b0-11...0077b07658.html

Borrowers advised to make early search for new rate

Brokers say borrowers now need to be looking for a new rate well before the end of their existing deal. Savills is recommending that clients start looking for new deals six months before their initial offer runs out, two months earlier than it had previously advised.

“Borrowers have no time to delay,” says Bien. “If you see a deal you like the look of, you should secure it immediately – otherwise you could miss out.”

It is possible to reserve a mortgage rate for up to six months before you actually need to remortgage. To do this you may have to put down a reservation fee – typically around £100 – and pay for a new property valuation, which is likely to cost in the region of £300.

If the deal still looks attractive when your existing mortgage runs out you can swap onto the new reserved rate. But if conditions improve and there are more competitive deals around you are not tied in, although you would lose the reservation and valuation fees.

Mortgage costs are likely to vary dramatically depending on whether a bank is keen to lend or not. A broker that scours the entire market could help you find the best deal.

Brokers are also urging borrowers to pay closer attention to lenders’ standard variable rates (SVR) – the rate they will revert to when the offer period elapses – as well as initial deal rates.

At present, lenders’ SVRs vary from 5.99 per cent to 7.69 per cent, according to Moneyfacts.co.uk.

Borrowers looking to remortgage could try to pay off a chunk of their loan to reduce their loan-to-value. Banks are increasingly reluctant to lend high proportions of a property’s value so the lower the loan-to-value the more chance there is of securing a competitive deal.

Another tip is to pay any initial booking or valuation fees upfront rather than adding them onto your mortgage as this ensures they are taken and could help secure the new deal.

Submitting your mortgage application online could also save valuable time. It is also wise to keep your credit record as clean as possible – a missed payment on anything could lead a lender to reject your application.

Anyone who thinks they could have real difficulty affording new higher mortgage rates could temporarily switch to an interest-only deal as this would mean cheaper monthly costs. But interest-only mortgages work out more expensive in the long run.

Edited by alabala

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On a radio phone in yesterday here in Wales a woman rang in for advice from a mortgage expert. She needed to remortgage by August and had begun looking already - quite sensibly - but she seemed to be of the opinion that she coudl haggle with her lender over the varaible rate she was about to go onto and actually get a rate less than her now ending 5 year deal. She was quite miffed when told she would be lucky to get any mortgage now let alone be able to haggle.

Sadly, this just indicates how out of touch a great many of the Public still are about houses, mortgages and house prices.

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Are brokers just trying to make business for themselves? I would've thought banks would want to keep the business if they have, and so remortgaging rates might decline. What do these 'whole of market' brokers do then?

I've only got a £40,000 mortgage and even I'm becoming spooked about where things are going and how I'll get a new deal at the end of the year. If my LTV for high I'd be seriously terrified at the moment.

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I'm a broker and I'm seeing deals being pulled by the day. Looking back at quotes I did in January often todays equivalent will be higher by about 0.5% if it is available at all. Lots of clients are seeing headlines saying BOE rates are coming down and think they will get a better rate if they wait - they're not. Products are often on the market for a couple of weeks, sometimes only a few days then being withdrawn, so if a broker tells you to take a deal now because it may not be around tomorrow that is probably the truth. The last 3 applications I have done were all on products that were pulled later the same day or the next working day.

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Mortgage lenders as a group probably don't think it's to their advantage for lots of borrowers to exit fixed rate deals when they come to an end and switch to cheaper mortgages. So is part of contraction of the new mortgages market a kind of subconscious conspiracy, an alignment of self-interests by lenders, to make it more difficult for thousands of people to switch to cheaper deals, all at the same time?

We hear a lot about the problems facing home owners when their fixed-rate terms come to an end. But if they all manage to swap to cheaper mortgages, that's bad news for the lenders, or have I missed something?

Edited by Sofa Spud

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No, they just don't have the cash. NR almost stopped lending (they were 15% to 20% of the market a year ago) A&L puuled right back, HBOS (Halifax, BofS, BM Solution, IF) have pulled back, thus anyone left can put in place whatever restriction they like and charge what they like (within reason) and still do double or triple their target volumes. This is for real, it is not the media scaremongering.

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http://business.timesonline.co.uk/tol/busi...icle3593440.ece

At the same time, Halifax, Britain's biggest mortgage lender, increased its mortgage rates for the third time in six weeks, raising its two-year tracker deal by 0.25 per cent for new customers, despite the fact that interest rates were kept on hold at 5.25 per cent.

Seems prices are rising a bit but not rocketing so if demand's high there won't be enough to go around.

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I'm a broker and I'm seeing deals being pulled by the day. Looking back at quotes I did in January often todays equivalent will be higher by about 0.5% if it is available at all. Lots of clients are seeing headlines saying BOE rates are coming down and think they will get a better rate if they wait - they're not. Products are often on the market for a couple of weeks, sometimes only a few days then being withdrawn, so if a broker tells you to take a deal now because it may not be around tomorrow that is probably the truth. The last 3 applications I have done were all on products that were pulled later the same day or the next working day.

I have an offer from B&Midshires that is due to an aborted purchase, the offer expires on 28th April and obviously I have already payed my fees.

Are they able to pull the offer today if they so wish, or are they contractually obliged to offer until 28th April ?

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No, they just don't have the cash. NR almost stopped lending (they were 15% to 20% of the market a year ago) A&L puuled right back, HBOS (Halifax, BofS, BM Solution, IF) have pulled back, thus anyone left can put in place whatever restriction they like and charge what they like (within reason) and still do double or triple their target volumes. This is for real, it is not the media scaremongering.

I realise they don't have the cash, but if fixed raters all change to new cheaper mortgages, all the lenders will lose out in a swings and roundabout sort of way. I'm saying this might be a significant additional factor in the current situation.

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Ive just been doing a search on money super market for am unsecured loan for buying a car. I see they have now spilt the search into whether you have a good fair or bad credit rating. Last time I checked I was good but as I have not debt I might now be classed as fair but for a 10k loan for good rating APR is 6.8 from Tesco for a fair rating 16.5 and for poor 23.1APR

Dont think it will be long before the 6.8% from Tesco disappears!!

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It's been a terrifying week for anyone with substantial debt. Even people that 'don't watch the news' will be getting wind of it one way or another.

And it's also been pretty rough for people with a 'just past the end of their nose' timeframe on shares. And shorting scum especially now they're being clamped down on with hefty margins.

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To do this you may have to put down a reservation fee – typically around £100 – and pay for a new property valuation, which is likely to cost in the region of £300.

I wonder if existing borrowers will start doing this as well? It is an easy excuse for upping the premiums.

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I have an offer from B&Midshires that is due to an aborted purchase, the offer expires on 28th April and obviously I have already payed my fees.

Are they able to pull the offer today if they so wish, or are they contractually obliged to offer until 28th April ?

Have you thought about reading the contract?

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I have an offer from B&Midshires that is due to an aborted purchase, the offer expires on 28th April and obviously I have already payed my fees.

Are they able to pull the offer today if they so wish, or are they contractually obliged to offer until 28th April ?

One of my neighbours had an offer pulled by HSBC because the property he wanted to buy did not provide enough collateral in their view. Happened in August. I fear they probably all have generic get-out clauses but I don't know for sure.

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I have an offer from B&Midshires that is due to an aborted purchase, the offer expires on 28th April and obviously I have already payed my fees.

Are they able to pull the offer today if they so wish, or are they contractually obliged to offer until 28th April ?

They shouldn't but they might. They could also argue that the application was for that particular property and is not transferable. I had this with BM, a client had a mortgage for a flat in a conversion, then got offerred a different flat, bit nicer but same price, same conversion, BM tried saying he couldn't transfer the mortgage. They admitted part of their reluctance was that the deal was losing them money (tracker 0.76% below base). In the end they agreed.

I always recommend to have any product fees added to the loan, that way if it doesn't happen for whatever reason you have not lost the product fee.

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  • 298 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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