Rates are creeping up…

Panic Panic Panic………ok, so that’s a little dramatic!  However, we have seen a number of lenders increase rates over the last few days.  TSB, Halifax, Nationwide, Virgin Money, NatWest and Coventry Building Society are just a few who increased their rates on various product offerings.  We have seen SWAP rates (the mechanism through which lenders can acquire a fixed price for funding over a specific period of time) start to creep upwards and as such lenders are re-pricing accordingly.  Despite my headline, I don’t believe it is really time to panic just yet.  Many pundits are suggesting middle of 2016 before we see a true rate rise.  Just keep an eye on things if you are looking for a long term bargain.

What we have seen recently are lot of enquiries to remortgage for home improvements.   Increasing the value in your property can involve large renovation, adding a room or two and a general investment in time and builders.  That said, with house prices booming in the local areas, many have decided to look at cosmetic changes.  So up-grading kitchens, bathrooms, redecorations and so on.  Whether small or large, the investment in property can bring rewards to the value and if you are staying put, reward in the satisfaction of home comfort.  Plus a potential large saving in stamp duty too versus moving home!

We have also seen an increase in customers looking to consolidate debt or even look at debt management plans.  Both can sometimes cause issues. If you consolidate unsecured credit in to your mortgage, although your monthly payments may be lower, you may be paying more interest for your debt over a longer term.  With debt management plans, or Individual Voluntary Arrangements (IVA), etc, again, the lower monthly payments may help in the short term, but you may well find it hard to gain an approval from a lender to refinance at a later date.  Lenders tend to shy away from debt management plans and may not consider anyone who has been in an IVA unless it has been discharged for more than three to four years. Advice should always be sought before entering in to these types of arrangements or agreements.