Despite the negativity in the media, they recently reassured us that there is actually lots of good news for anyone currently looking to purchase or re-mortgage. Charlotte Skinner, Mortgage Adviser, recently commented “rates are decreasing, - every day, hourly! They peaked at approximately 6.5% in September 2022, however, they have been continuously decreasing and a new 5-year fixed rate deal has just been released at *3.85%!
Charlotte continued to add some future certainty, “although the Bank of England Base Rate has increased again to 4% - this was planned and accounted for, so fixed rates are still reducing. We monitor SWAP rates daily, as these indicate where the markets expect the market to go. The 5-year SWAP rates are currently below the Bank of England Base Rate of 4%, therefore, the market is currently predicting that we are at, or near, the peak of rate rises.
To add more reassurance, “affordability calculations have also started to increase. If a client were to take a 5-year product, or more, then the maximum lending has typically increased by 9% (or £25,000) according to Halifax. During and after Covid, the majority of 90% and 95% loan-to-value (LTV) products were withdrawn - at one point you had to have a much larger deposit. Now lenders are once again offering up to a 95% LTV, the lowest as of 22nd February 2023 is at 4.94%!
And for those re-mortgaging Charlotte has this advice, “do not panic when your mortgage is due for renewal, there are many options. As mentioned rates have, and are continuously going down, other processes and policies have also been put in place to support people who can’t afford increases.”
As is always the case, should you need any help or advice contact your nearest branch for help.
* 31/07/2028 £1499 fee Free valuation, £250 cashback 60% LTV 5.7 APRC
Photo by Tierra Mallorca on Unsplash
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