Appetite to lend in last quarter

Only a few days into the final quarter of the year and we’re already seeing lenders lowering rates to attract new business.

Woolwich have cut some rates by up to 0.2% and Abbey for Intermediaries have reduced various fixed rates across the range, both following numerous lender changes last week.

Accord Mortgages have also launched eight products aimed at First Time Buyers with a 10% deposit.

Rates are reasonable and some offer free valuations and £250 cash back.

All in all, it seems there is an appetite to lend in the last quarter (to hit bonus targets?!) and this is great news for the end consumer.

Second charge lenders are also in the midst of a price war.

Many have reduced rates, one or two new lenders have entered the market and another has increased their maximum loan size up to £200,000.

Many customers are making use of a second charge, rather than a full remortgage, as their existing first charge mortgage is on a very good rate and it may not prove cost effective to remortgage the whole amount.

Make sure you review all options available to you.

House prices have fallen 0.4% in September, according to the Nationwide House Price index.

The average house price now stands at £164k.

Nationwide go on to suggest that overall house prices should remain “relatively flat” or decline only modestly over the next 12 months.

With a recent Panorama programme highlighting the use of Payday loans around the country, I need to reiterate that these are classed as an ‘adverse entity’ with most lenders (not that some would admit it!).

In short, these lenders will charge a premium interest rate for a mortgage, compared to a high street lender.

However, even these lenders (those who accept customers with historic CCJs, defaults, or missed mortgage payments registered against them) MAY NOT accept someone who has taken out a payday loan.

So, although these may be right for a customer in certain circumstances, they will most definitely limit the number of lenders available to you when you come to apply for or change mortgages.

Seek advice.

Dale Jannels - AToM director