Mortgage rates have continued to reduce over the last month, which along with more lenders relaxing their criteria and willing to loan more to customers based on income, has all been seen as a positive in the mortgage market.
However, what effect will the Budget have on this?
The reduction in the cash ISA allowance raises concerns that building societies will limit the amount they can lend to borrowers as they rely on these saving amounts for funding.
The new mansion tax could also have an adverse effect, as the top of the market is often the driver for the rest of the housing market and this could have a ripple effect. Unfortunately, the mansion tax will impact many retirees who bought their properties many years ago, and whilst the value of their homes has increased substantially, their retirement income has not. Lifetime mortgages could prove to be a lifeline for many to cover these additional costs.
However, rates still remain at under 4% and further reductions and the continued relaxation of criteria all look positive for borrowers.
| • 2-year fixed at 60% LTV – 3.72% with a lender’s arrangement fee of £999 |
| • 3-year fixed at 60% LTV – 3.80% with a lender’s arrangement fee of £999 |
| • 5-year fixed at 60% LTV – 3.83% with a lender’s arrangement fee of £999 |
| • Buy-to-let 2-year fixed rate at 60% LTV – 3.71% with a lender’s arrangement fee of £1,499 |
LTV = loan to value
Residential repayment fixed rate – a number of these deals can be done on an interest-only basis up to 50% with sale of property as the repayment strategy
| LTV | Rate | Arrangement Fee | ERC |
|---|---|---|---|
| 60% | 2-year offset fixed – 4.44% to 28.02.28 | £1499 | YES |
| 60% | 5-year offset fixed – 4.55% to 28.02.31 | £1499 | YES |
| 60% | 2-year fixed – 3.72% to 02.03.28 | £999 | YES |
| 60% | 5-year fixed – 3.83% to 02.03.31 | £999 | YES |
| 75% | 2-year fixed – 3.77% to 02.03.28 | £999 | YES |
| 75% | 5-year fixed – 3.92% to 28.02.31 | £999 | YES |
Residential repayment tracker/discounted rate – a number of these deals can be done on an interest-only basis up to 50% with sale of property as the repayment strategy
| LTV | Rate | Arrangement Fee | ERC |
|---|---|---|---|
| 60% | 2-year tracker – 0.11 + BEBR = 4.36% | £1,499 | NO |
| 75% | 2-year tracker – 0.23% + BEBR = 4.48% | £1,499 | NO |
Buy-to-lets, Second Charge, Bridging Finance, Equity Release Loans available – rates upon request
We’re here to help
We strongly recommend that borrowers seek professional independent financial advice before making a final decision on the most suitable course of action for your individual circumstances. If you have any questions on the buy-to-let sector reforms, rates or the mortgage market in general, our mortgage team is here to help. Please contact the team on 020 7444 4030 or by email.
The contents of the article have been prepared solely for information purposes. The article contains information on financial products and services and such information is designed for and addressed solely to individuals seeking generic industry information. Past performance is no guide to future returns. The above content does not represent a personal recommendation. Your home is at risk of repossession if you do not maintain mortgage payments.