Wednesday, June 25, 2008

Lenders are not only pushing up rates, but they are also increasing charges

Lenders and developers hedge their bets in a falling market

The mortgage lenders have got homebuyers and their mortgage advisers over a barrel. With a shortage of funds in the market, lenders are imposing ever more impossible terms and conditions and pushing up charges across the board. Life is becoming increasingly difficult for brokers looking for a high loan-to-value (LTV) for their first-time buyer customers and others with a small deposit

Posted by jack c @ 02:53 PM (743 views)
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3 thoughts on “Lenders are not only pushing up rates, but they are also increasing charges

  • Are any of the contributors to this site at all concerned with these developments ? Have to say to date I have took delight in all the monthly falls etc but looking ahead are the banks going to ration loans so strictly that even with sizeable deposits etc we are going to get turned down ? I have no intention of buying this year aiming possibly late 2009 but just wonder what kind of state banks will be in to lend anything…not all us can rely on cash only deals.

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  • HOT OFF THE PRESS – note the new fee is payable UPFRONT

    Halifax, Bank of Scotland and TMB will be introducing a Mortgage account fee with effect from 29th June 2008 for all new mortgage accounts.

    The new fees applicable are Halifax and Bank of Scotland £245, TMB £275.

    The fee is to cover the setting up, routine maintenance and closing down of the mortgage account and is part of the overall price paid by the customer for taking out the mortgage. The Mortgage account fee is a fixed, clear, upfront fee and is not interest bearing.

    This new single fee is less than the total of the mortgage exit fee we removed last year plus a number of post completion service fees now also being removed. Many other lenders continue to charge an exit fee and all or some of the service fees we are now removing. To see the new fees tariff which will be available from Monday 30th June 2008, please visit the appropriate brand website.

    The fee will be debited to the mortgage account on completion* and will remain interest free for the life of the loan.

    *Initially the ability to debit this fee on completion will not be available. However, customers affected by this will be advised in their mortgage completion letter, that the fee will be debited to the mortgage account prior to the first annual statement being issued.

    Additional information:

    Any new mortgage where the first KFI is generated after 8pm, 28th June 2008 on our mortgage system will be charged a Mortgage account fee.
    All documentation will be updated to refer to the Mortgage account fee for those applications received after 8pm.
    Existing mortgage application customers (those with a KFI generated prior to 8pm, 28th June 2008) will not be charged a Mortgage account fee.
    Further Advance and Product Transfer customers are unaffected.
    Sourcing Systems will be updated at midnight, Friday, 27th June 2008. KFIs will display the Mortgage account fee, however if submitted before 8pm, 28th June 2008 the fee will not apply.

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  • ljjhall – yes – i just wonder when the LTVs will stop reducing. Its probably a combination of two things. The first is the LTV but more important in my view is the move to “realistic valuations”. I would love to hear from valuers on this (as bloggers), i suppose at some point in time they may be encouraged to give conservative valuations or “future” valuations at the current time indicating discounts. Also i wonder how low historical LTVs have been. Im not really old enough to comment but its of interest. I think yes going forward you will need a sizeable deposit in terms of % – but in terms of ££££ thats more of an issue isnt it?

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