So the new MMR (Mortgage Market Review) regulations are now in force and the mortgage market has not ground to a halt, despite what some pundits insinuated it might! It’s business as usual, albeit a little more intrusive and the process may be taking a little longer than before. Some customers are reporting that the high street lenders mortgage interviews are taking well over two hours and more than a week to book appointment (no such problem with your local independent mortgage advisers!). Others are reporting some absurd questions being asked such as how much do you spend on alcohol per month, how much on pet food and have you got a national lottery direct debit? As with all things, whilst the new rules settle in, there will be some teething problems, but be patient with them as they are here to stay and for everyone’s protection. Just ensure that you have all your monthly costs laid out accurately from the outset and ready for when requested. If you spend £500 a month on food, then that’s the figure to advise. If you don’t and the lender reviews your bank statements and finds discrepancies, this will not be looked upon favourably.
Coincidently, we have seen some rates increase over the last week. Both NatWest and Santander have increased rates on their Help to Buy Mortgage Guarantee schemes. NatWest increased some of their 95% loan to value rates by 0.4% on two year fixed deals. Santanderincreased their 5% deposit rates by 0.1%.
The British Bankers Association has confirmed that purchase figures for March 2014 were up 45% compared to March 2013. Gross lending amounted to £6.4bn.
Remortgaging amounted to £2.9bn for the month, the same as in February, but an increase of 32% compared to the same time in 2013.
Finally, I’ve mentioned this matter a number of times, and make no apology for doing so again! If you have an Interest Only mortgage, do make sure you keep reviewing the options for repaying it back. Where a customer reaches the end of their mortgage term still owing exactly the same as when they took it out, with no form of repayment apart from selling their property, this creates a major headache for the lender. Especially when they want their money back! This is a major aspect of the new regulations which are now implemented, so be on top of your options, before the lender calls! If in doubt, seek professional advice.
