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Millions owed due to mis-sold endowments

There has been a great deal of controversy lately over the sale of endowments, which many officials are stating were mis-sold to consumers in the 1980s and 1990s, leaving many with little or no hope of being able to repay their mortgage at the end of the term. Endowments are sold alongside interest only mortgages to enable borrowers to repay the initial loan amount at the end of the mortgage term through the growth of the investment. The monthly repayments are used to pay off just the interest on the mortgage. Read more

Huge financial losses for bad credit mortgage applicants

A recent report has shown how a number of bad credit consumers are suffering huge financial losses after their mortgage lenders pulled out of their mortgage offers at the last minute. The recent financial turmoil in the money markets have led to increased worry amongst lenders and increased stringency when it comes to lending, particularly in the sub-prime sector. Reports claim that some bad credit customers who thought that they had secured a mortgage and that everything was running smoothly have then had the rug pulled out from under them, leaving them with losses of thousands of pounds in some cases. Read more

Northern Rock scraps two thirds of mortgage products

Troubled mortgage lender Northern Rock has announced that it will be scrapping many of its mortgage products after the recent turmoil that resulted from its decision to take an emergency loan from the Bank of England. Following the discovery of the loan many of the 1.5 million savers with the Rock decided to withdraw their savings amidst fears that the bank was on the verge of collapse. This saw share prices tumble by over 80% as well as billions of pounds in savings being withdrawn from the bank. Read more

Remortgaging to a base rate tracker could be a good choice

According to some industry professionals remortgaging to a base rate tracker mortgage could be a good choice for many homeowners, as this will enable them to benefit from the series of interest rate cuts that are expected to be applied by the Bank of England next year. Over the past year and a half there have been five interest rate rises, and this has seen the base rate rocket from 4.5% in August 2006 to 5.75% by July of this year. In December, however, interest rates finally fell by 0.25%, taking the base rate to 5.5%. Read more

Co-op shelves two year mortgage

Over recent months many lenders have decided to take a variety of mortgage products off the shelves due to lack of funding or lack of supply compared to demand. In a recent announcement the Cooperative Bank stated that it was taking its popular two year mortgages off the shelves for now, as it was unable to keep up with demand. Many banks and lenders have suffered difficulties in securing finance for their mortgage lending operations due to the credit crunch, and this has affected their ability to keep up with demand. Read more

Interest rate cuts do not stop lenders from hiking up borrowing rates

A recent report has shown that the recent base rate cuts applied by the Bank of England have done nothing to stop some lenders from hiking up their borrowing costs and interest rates, which means that many consumers are still having to pay through the nose for their borrowing despite the three base rate cuts since December. In the last few months the Bank of England has cut the base rate from 5.75% to 5% with three 0.25% rate cuts. Read more

Possible house price crash causes increased fears

A number of officials have expressed concern over the possibility of a house price crash in the UK similar to that seen in the 1990s. Officials have said that if something is not done to ease the problems in the mortgage market the likelihood of a house price crash is set to increase, and this is causing increased fears amongst consumers and industry officials. Read more

Mortgage costs add to housing slump problems

A recent report has shown that the huge chink of income that many homeowners are having to pay out on their mortgages has added to the risk of a major housing slump in the UK. A study was recently carried out by Capital Economics, and showed that the amount that homeowners are forking out on their mortgages could be higher than the previous record seen in the 1980s, with many now thought to be shelling out up to one third of their income on their mortgage. Read more

Internet bank withdraws mortgages for non-customers

The Internet banking arm of HSBC, First Direct, has recently announced the withdrawal of mortgage products to consumers that are not customers of the bank. The mortgages came off sale to non-customers of the bank at the beginning of this month, and the range that is being taken off sale includes its two year fixed rate offset mortgage. Customers that are with First Direct will still be able to access mortgage products even if they do not currently have a mortgage with the bank. Read more

A&L takes popular mortgage off the shelves

The Alliance and Leicester has recently announced the withdrawal of one of its most popular mortgage products from the market, stating that it can no longer keep up with demand for the mortgage product. The two year fixed rate mortgage from the Alliance and Leicester has enjoyed huge popularity in the past, but officials from the bank have stated that demand is now outstripping the ability to supply, and with this in mind the lender has decided to take the deal off the market altogether for the foreseeable future. Read more

Estate agency industry still unhappy with HIPs

Since they came into force last year Home Information Packs have proven very unpopular with certain industry sectors, particularly the estate agency sector, which has claimed that the packs are costly, time consuming, and ineffective. The government introduced HIPs last summer, but they only became compulsory on all residential properties being marketed for sale in England and Wales in December of last year due to a number of unforeseen delays. Read more

Many plan to sell their home and rent property

According to a recent report many homeowners who are planning to sell their properties are planning no to get back on the property ladder just yet, opting instead to rent a home for a while to see what happens with house prices. There have been many different predictions with regards to what will happen with house prices over the next couple of years, with most indicating that house prices could fall significantly. This has resulted in more people trying to sell up whilst house prices are still high, and then waiting before purchasing again to give house prices a chance to fall. Read more

BoE faced pressure to cut interest rates

With house price growth having fallen to its lowest level in twelve years, and with gloomy predictions about plummeting house prices over the next couple of years, the Bank of England has been facing increasing pressures over cutting interest rates, despite the fact that rates have already been cut a number of times since December. The Nationwide Building Society recently reported that house prices were only 1.1% higher than at the same time last year, and were showing the smallest increase since 1996. Read more

House hunting season gets off to a slow start

Industry experts have reported that the spring house hunting season this year has got off to a very slow start, as the effects of the credit crunch continue to bite, and potential buyers struggle with trying to raise the money that they need to purchase a property. The global credit crunch has impacted heavily in the housing and mortgage sectors, and the additional predictions that house prices are going to fall over the next two years is also affecting consumer interest in purchasing a property. Read more

Poor DIY could see house prices tumble

There is already a great deal of concern over the drop in house price inflation, with house price growth now at its lowest in 12 years, according to industry professionals. However, there are also concerns that some consumers may end up reducing the value of their homes even further by attempting to carry out DIY home improvement when they do not have the skills or expertise to do a good job. Industry officials state that whilst some homeowners might think that they are improving the value of their home with these improvements, a shoddy end result could have just the opposite effect. Read more

Difficulties for homeowners trying to sell their homes

According to a recent report homeowners that are trying to sell their properties in many parts of the UK are experiencing real problems, with many having to see their home stagnate on the market for long periods of time before selling, and others deciding to take their homes off the market after being unable to sell. Read more

Experts state long term fixed rates may not be best

In a recent report a number of industry experts have stated that longer term fixed rates, such as the 20 and 25 year fixed rate mortgage terms that the Chancellor of the Exchequer has been pressing for, many not be the best choice for many consumers. Alistair Darling has said that longer term fixed rate deals for 20 or 25 years could prove beneficial to homeowners because they can provide peace of mind and security, and can also benefit the housing and mortgage markets by providing increased stability. Read more

Former government adviser casts gloomy outlook for house prices

A former government advisor and senior economist has cast a gloomy outlook for house prices, predicting that the value of the average property in the UK could plummet by 20% over the next two years, leaving some homeowners facing the pitfalls of negative equity, and seeing many others lose thousands of pounds off the value of their properties. Should this situation come to fruition the average house price could fall from £200,000 to £160,000 in the space of two years. Read more

Shadow housing minister thinks HIPs are a waste of time

In a recent statement the shadow housing minister has stated that the controversial Home Information Packs, which were introduced and implemented over the course of last year, are a waste of time. This comment comes after a recent trial showed that HIPs were not proving as effective as officials had hoped, largely because only one in every six potential property purchasers were seeing the pack before making an offer on the property. Read more

Chancellor pressing for long term fixed rate mortgages to be made available

Since Alistair Darling took over as the Chancellor of the Exchequer last year one of the issues that he has been addressing on a regular basis is the housing and mortgage market, and how increased stability can be brought to these markets. The chancellor has been stating for some time that long term fixed rate mortgages are necessary in order to bring stability to the markets, and this is something that he has brought up recently in his first budget. Read more

Loans and mortgages still inaccessible due to credit crunch

Industry professionals have recently stated that consumers are continuing to find many loan and mortgage deals inaccessible in the UK due to the damaging effects of the credit crunch in the finance sector. The credit crunch has had a profound impact on the financial markets, and due to its effects many lenders have had to look at taking some loans and mortgage deals off the market, as well as raising rates on some finance deals, and even restricting lending by making lending criteria more stringent.

There are some groups that are likely to suffer far more than others as a result of this situation. Those with good credit, and those with a substantial amount of money to put down on a mortgage, are likely to find things easier than those with damaged credit and first time buyers with little or no savings to put down on a property. A number of lenders have taken some or all of their sub-prime deals off the market recently, and are minimising on risk by refusing to lend to higher risk customers. Read more

Central bank governor and deputy governor did not agree on interest rates

Following the recent Monetary Policy Committee meeting earlier this month the Bank of England announced that it would be keeping interest rates on hold at 5.25%, stating that the risk of rising inflation had to be considered in addition to the slowing economy. Interest rates have already fallen twice since December, and industry experts predict that they will fall at least one more time before summer and then again in the latter half of the year. Read more

Household finances hit by a number of rises

Since August 2006 things have gone from bad to worse for many households, with interest rates rising five times between August 2006 and July 2007, each time by 0.25%. This saw the base rate soar to 5.75% from 4.5% in this period, and many homeowners on variable rate mortgages struggled to find the money to meet their rapidly rising repayments, which in turn affected consumer confidence and had a knock on effect on the economy. Read more

Increase in buy to let mortgage lending

According to a recent report the end of last year saw a rise in the level of buy to let mortgage lending, with an increase of around 25% compared to the end of the previous year. By the end of last year buy to let mortgage figures had broken through the £1 million barrier, with outstanding buy to let mortgage figures now at £1,038,000. Buy to let mortgages are continuing to thrive despite reductions in house price inflation and a bleak outlook for the housing market. Read more

House prices plummeting in England and Wales

According to a recent report house prices in England and Wales are now falling at their fastest level since 1978, which is when records first began. The report comes from the Royal Institute of Chartered Surveyors, and claims that house prices are now tumbling in every region of England and Wales, partly fuelled by the credit crunch amidst other factors. A number of areas, such as East Anglia, Yorkshire, and the East Midlands, are said to be suffering the fastest decline on record. Read more

Repossession levels reach eight year high

According to recent reports repossession levels last year reached an eight year high, as homeowners struggled to keep up with the rising mortgage repayments that stemmed from five interest rate hikes between August 2006 and July 2007. Although there were no further hikes after July of last year, the base rate remained static at 5.75% and did not fall until December, by which time it was too late for many homeowners who had already lost or were in the process of losing their homes. Read more

Increased affordability for many first time buyers due to interest rate cuts

Officials from the Council of Mortgage Lenders have recently stated that affordability for first time buyers could be increasing, with interest rates already having fallen twice in the last few months, and set to fall further over the course of this year. First time buyers saw affordability fall to its lowest in sixteen years last year, with the average first time buyer paying out close to 20% of their income on mortgage interest, which is the highest level since 1991. Read more

Rise in gross mortgage lending for January states CML

Officials from the Council of Mortgage Lenders stated recently that there was a rise in gross mortgage lending for the month of January. The figures show that despite the turbulent housing market January saw a rise of 11% in gross mortgage lending compared to December. CML officials claim that in January lending levels rose to £26.5 billion compared to £23.9 billion in December. Read more

MPC member states falling house prices pose threat to economy

A member of the Monetary Policy Committee, Kate Barker, recently stated that falling house prices coupled with decreased lending levels posed a significant threat to the UK’s economy over the short term. She said that the Monetary Policy Committee would be looking carefully at financial and property markets when it came to setting interest rates, but also added that it would be difficult to justify cutting rates when concerns over inflation were so high. Read more

Experts give their views on interest rates

In December of last year the Bank of England cut interest rates by 0.25%, which was the first rate cut in two years, and came after a series of five 0.25% hikes between August 2006 and July 2007. Earlier this month the Bank of England cut interest rates by a further 0.25% taking the base rate to 5.25%, which came as a relief to many struggling homeowners on variable rate mortgages. Read more

Darling says longer term fixed rate mortgages to become the norm

Chancellor of the Exchequer Alistair Darling has stated that there is to be a radical shake up the mortgage market, which will result in longer term fixed rate mortgages for twenty five years becoming the norm. Darling has been looking for a longer term borrowing solution for homeowners in light of the level of homeowners that have struggled to keep up with their mortgage repayments following higher interest rates. Read more

Bank of England cuts interest rate

The Bank of England has announced that interest rates are to be cut to 5.25% following the latest Monetary Policy Committee meeting. The drop of 0.25% had been widely predicted by analysts and economists, although many have stated that the decision would have been a difficult one. Last month the majority of committee members voted to keep rates on hold amidst fears over rising inflation levels, but this month concerns over the slowing economy appear to have taken the front seat, hence the decision to cut rates by 0.25%. Read more

Experts predict cut in interest rates

Many economists are predicting that the Bank of England will be cutting interest rates this week following the Monetary Policy Committee meeting. It is widely predicted that the Bank of England will cut rates by 0.25%, taking the base rate from 5.5% to 5.25%, which will give borrowers on variable rate loans a little more breathing space. The Bank of England last cut the interest rate by 0.25% in December, but despite high expectations did not cut the rate in January due to inflationary pressures. Read more

Bank of England will not follow suit following Fed rate cuts

The US Federal Reserve has slashed interest rates considerably over the past couple of weeks, taking them down the first time by 0.75% amidst fears of a recession, and then reducing them further to 3%. The move resulted in many homeowners in the United States flocking to try and refinance to a lower rate deal whilst rates were at such as low. Read more

Over one million could lose their homes in next 18 months

Officials from the Financial Services Authority, the UK’s financial regulator, have warned that over the next 18 months over one million homeowners in the UK could end up losing their homes. Read more

Average property prices plummeted in three months

According to a recent report the average UK property value plummeted between October of last year and January of this year, with around £11,000 being shaved off the average property value. The reports show that this has seen some properties fall in value by over £100 per day, and according to some industry officials things are going to continue getting worse for homeowners when it comes to falling property prices. Read more

Remortgagers warned not to delay

Consumers that are looking to remortgage to a cheaper, more affordable mortgage deal are being warned not to delay because cheap mortgages are flying off the shelves and selling out at record speeds, according to a recent report. Some of the top mortgages are selling out at very short notice, and experts state that in some cases remortgagers who have signed up to a deal and even paid application fees have lost out because the mortgage has sold out during the process and the remortgager has then had to sign up to a higher rate deal. Read more

Second UK home for two million Brits

According to a recent report around 5% of the adult population in Britain has a second home in the UK, equating to more than two million people with a second home. The figures show that more than two million people have a family home and on top of that have another property within the UK. Read more

Investment professional predicts house prices to fall by 10%

According to one investment professional house prices in the UK are set to fall by 10% this year, and the average home could actually fall in value by around £18,500, which equates to around £50 per day. The prediction has been made by Neil Woodford from Invesco Perpetual, who states that house prices in the UK are simply too high. The investment expert, aged 47, stated that some parts of the country are set to be hit harder than others. Read more

House values drop an average £11,000 since October

According to recent research the value of properties in the UK have plummeted by an average £11,000 since October. This equates to an average daily fall of £120 a day in house prices, and many experts have stated that things are set to get worse over the coming year. The report was put together by property specialist website Right Move. Read more

100% mortgage getting increasingly difficult to find

A recent report has indicated that finding a 100% mortgage deal has become increasingly difficult over recent months, as credit conditions have become tighter and tighter in the UK, and this situation is set to get worse over the course of the year according to some industry officials. The credit crunch that swept across the UK last year has had a number of repercussions, and many lenders have had to tighten their belts when it comes to lending in light of factors such as bad debt levels and difficulties with inter-bank lending. Read more

Interest rate cuts called for by BCC

Following the Bank of England’s decision to keep interest rates on hold for January, the British Chambers of Commerce has called for further modest interest rate cuts in order to avoid a marked slowdown in the economy. After the Monetary Policy Committee meeting earlier this month the Bank announced that interest rates would be kept on hold at 5.5%, and this disappointed many consumers and industry bodies who had been expecting an interest rate cut. Read more

Buy to let mortgage lender reduces lending

Recently the Nationwide commercial division announced that it would be limiting its lending by not lending to new clients and not taking on broker referrals, focusing instead on existing borrowers. One official stated: “I am using market conditions to be very selective about the type of lending we do. There is an enormous appetite out there for borrowing, half of my competitors have disappeared and a lot of people are looking for finance.” Read more

First time buyers could face bleak home ownership prospects due to LTVs

Over recent years things have not been easy for first time buyers in the UK. With property prices soaring many first time buyers quickly found themselves priced out of the market altogether, unable to afford to raise a mortgage for the amount needed to purchase even a modest property in some areas. Banks and building societies tried to ease the situation by offering higher income multiples so that first time buyers could get onto the property ladder, even though this meant that they were saddled with huge levels of debt. Read more

Mortgage broker makes predictions for house prices and interest rates in 2008

Industry officials from the mortgage broker John Charcol have been making predictions with regards to house price movement and interest rate movement for the coming year. Many industry professionals have been speculating over how house prices will perform and what the Bank of England will do with interest rates over the course of the year, with the general consensus being that house prices will stagnate or fall slightly and the Bank of England will cut interest rates two or three times over the course of the year, taking both economic slowdown and rising inflation into account. Read more

LMS pleased over rollout of HIPs

The conveyance group LMS has recently stated that it is pleased that Home Information Packs have now been rolled out to all residential properties being marketed for sale across England and Wales, adding that the rollout should prove to be a positive move for those planning to purchase a property. Read more

Bank of England decides to keep rate at 5.5%

Following the last Monetary Policy Committee meeting held last week, the Bank of England has decided to keep interest rates on hold at 5.5%. Interest rates fell from 5.75% to 5.5% in December in a move that was welcomed by both industry and consumers. This followed a series of five interest rate hikes of 0.25% each between August 2006 and July 2007, which saw many homeowners struggle to keep up with repayments on their mortgages and saw the level of repossessions in the UK rocket. Read more

An average £8000 could be wiped off property prices this year

Over recent months there has been much speculation with regards to what will happen with property prices over the course of 2008, with a range of surveys and studies all pointing to the fact that house prices are set to fall, and have indeed already fallen over the final months of 2007. Officials from John Charcol recently predicted that house prices will fall by 2% over the course of this year, with other industry officials largely predicting that house prices will either stagnate or will continue to fall. Read more

Positive outlook from lenders for coming year

As 2008 gets off to a financially turbulent start many lenders have expressed optimism for the coming year. According to the Intermediary Mortgage Lenders Association many of its members are remaining positive with regards to their outlook for the coming year, despite predictions that the credit squeeze is set to get worse and despite the already destructive effects of the credit crunch that swept across the UK in the summer of last year. Read more

Things to avoid when selling your home

Selling your home can be a difficult task at the moment, with a combination of a slow housing market, lower first time buyer interest, falling house prices, and tight credit conditions all working against those wishing to sell up and move on. Read more

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