US financial ‘bailout’ approved
Tagged: Finance, Money, Mortgages, USThink Money report that the US financial ‘bailout’ approved
Cheap Remortgages: Remembering The Impact Of Interest Rates
Tagged: Mortgages, remortgage Credit crunch, housing crisis, foreclosure and inflation are all terms that we are becoming intimately familiar with. If you have not experienced the meaning of these terms personally, you may still k...What is a Secured Loan?
Tagged: Mortgages, remortgage A secured loan is a loan which is secured on your property, you can usually borrow upto £100,000 or more dependant upon the equity available in your property. They are usually easier to obtain because...Getting a remortgage deal
Tagged: Finance, Mortgages, Property, Real EstateRemortgaging is an important consideration for homeowners. If you’re on a fixed-rate mortgage, you will probably want to consider remortgaging at the end of your fixed period, and even if you’re on a variable-rate or other type of mortgage, you will probably want to consider remortgaging at some point.
In the right circumstances, remortgaging can be a great way of reshuffling your finances and potentially saving money. But according to a new survey by Cheltenham & Gloucester, many homeowners are unclear about what is involved in remortgaging.
The report’s findings include:
- One in three remortgagers do not realise they are able to switch to another lender
- 37 per cent of homeowners would not consider switching to another lender for fear of being rejected
- 30% would rather pay a higher interest rate than risk rejection by another lender
- 15% don’t understand how mortgage lenders decide eligibility
- 44% are worried about the perceived scarcity of deals
- 38% worry they may not be able to afford their new rate
- 38% will spend less than half a day shopping around for a remortgage deal
- 27% don’t want to tie themselves into a deal now when interest rates may fall at a later point
The findings would suggest that a lot of people are simply happy to stay with what they know - but Melanie Taylor, Head of Corporate Relations for Think Money, says that this means many people are missing out on some potentially significant savings when remortgaging.
“Mortgage deals are changing constantly, and especially in the current market where mortgages are being offered much less frequently, some lenders are being very competitive,” she said. “By remortgaging, homeowners can often make large savings on their monthly payments.
“Remortgaging should be treated in the same way as when you first took out your mortgage. Take your time to look at the market, look for the best deal, and go with that deal. Just a difference of half a per cent on your interest rates can make a noticeable difference to your outgoings.”
The figures speak for themselves. On a mortgage of £120,000 with a fixed 7% interest rate, monthly payments come to £858.10. Take the interest down to 6.5%, and your monthly payments are £819.81 - a saving of almost £40 per month, or £480 per year.
Taylor said: “Remortgaging is particularly important to those on fixed-rate mortgage deals, since at the end of the fixed-rate period, the interest rate usually switches to the lender’s SVR (Standard Variable Rate), which can potentially be higher than the fixed-rate.
“Variable-rate mortgages can often be cheaper than fixed-rate mortgages, but there is an element of risk involved, because the rates can go up at any time and this can make monthly payments much more expensive.”
Remortgage: quick tips
- Plan ahead. Don’t leave looking for a remortgage too late. Ideally, you should leave at least a few weeks to look over the market and ensure you know where to find the cheapest deals.
- Find out all the costs involved. Most fixed-rate mortgages will carry arrangement fees, which can prove to be expensive, although sometimes these can be added onto your monthly payments.
Also consider additional services such as PPI (Payment Protection Insurance) - this can be a lifesaver in certain situations, but it can add a noticeable amount to your monthly payments.
Avoid mortgages with annual interest.
Some lenders calculate your interest payments on the amount owed at the beginning of the payment year, meaning you will pay a relatively high amount of interest through out the year. Mortgages with daily interest charges calculate interest based on how much you owe at any given time, meaning you are technically paying off more of the mortgage. This can result in paying off your mortgage several years earlier compared with a mortgage charging annual interest.
Mortgages: where do we go from here?
Tagged: Mortgages, remortgage Many people are unwilling to take a risk on mortgages at the moment. With rates continuing to fluctuate it is hard for people to have faith in the market. The one thing to remember is, there are many ...Consumer protection Code of Practice for rent-back market
Tagged: Mortgages, Property, Real Estate, UKConsumer protection Code of Practice for rent-back market
Permalink: Consumer protection Code of Practice for rent-back market
by Lin Freestone
The Office of Fair Trading (OFT) is conducting a market study into sale and rent-back and is expected to publish it in the next ten days. One of the possible outcomes following the OFT market study could be to point towards a consumer code of practice.
The National Landlords’ Association (NLA) has revealed that its Code of Practice will include enforceable legal sanctions and financial penalties for those who fail to comply.
The NLA published its draft Code for consultation in August 2008. Responses have been received from a wide range of stakeholders including Crisis, Shelter, Citizens Advice, Council of Mortgage Lenders, National Federation of Property Professionals, Royal Institute of Chartered Surveyors, British Property Federation and the Chartered Institute of Housing.
There were also a number of responses welcoming the Code from private landlords and larger companies already operating within the sale and rent-back market.
The majority of responses have indicated that the Code of Practice could provide an effective framework and a firm foundation on which to build a robust system. This would help ensure consumer protection by shedding light on sale and rent-back transactions.
The chairman of NLA, David Salusbury, has said that whether the association’s voluntary Code of Practice is a staging post en route to regulation for sale and rent-back or is an end in itself, the critical factor is that vulnerable consumers are protected as soon as possible.
The NLA believes in market-led solutions where possible, and the work it is undertaking reinforces its commitment to removing so-called cowboys from the entire private-rented sector.
He commented that sale and rent-back is not appropriate in all situations. However, for some families who can no longer afford the costs of home ownership, ethical sale and rent-back should certainly be explored.
The association is under no illusions that some property investors have seen the chance to make a quick buck. However, it firmly believes gambling with people’s homes is unacceptable. Changes to the sale and rent-back market must begin now.
600 mortgage products withdrawn in just one week
Tagged: Mortgages, Property, Real Estate, UK600 mortgage products withdrawn in just one week
Permalink: 600 mortgage products withdrawn in just one week
by Lin Freestone
According to research carried out by Moneyfacts, the personal finance researcher, almost 600 mortgage products were withdrawn from the market last week, making borrowing even more difficult for potential homeowners.
Banks and building societies pulled their deals rapidly following the nationalisation of Bradford & Bingley at the beginning of the week.
At the start of the week there were 3,983 home loans available on the market, but this had fallen to 3,402 by the end of business on Friday, the lowest number ever recorded by Moneyfacts.
In addition, mortgage rates increased during the week. Moneyfacts reported that the average two-year fixed rate deal has increased from 6.26% to 6.33%.
Moneyfacts reported that for the last couple of months rates have been slowly improving and more lenders have returned to the market. It is considered quite alarming how quickly the market has deteriorated once again.
Speculation is that there is further pressure on the Bank of England to cut interest rates, with some leading economists predicting the bank could take the radical step of slashing rates from 5% to 4.5%.
Mortgage with CCJs - Post Credit Crunch
Tagged: Mortgages, remortgage Mortgages and Remortgages with CCJs may not be that difficult after the credit crunch. Mortgages and remortgages with CCJs after the credit crunch might seem like and an impossible task with d...Brits unaware of mortgage details
Tagged: Finance, MortgagesPersonal Loans
Tagged: Loan, Loans, MortgagesThe most appealing aspect to most of the personal loan is that it will be accepted to fund almost anything. Should you want to put money towards a new car, improving your garden or even the shopping spree for a holiday of a lifetime you can save money by getting out a decent loan rather than pay on a credit card. Credit card interest rates are usually much higher and you will pay for the convenience.
If you have decided to take out a personal loan, don’t be tempted to take out a larger amount of money than you actually need. Although the rates are very tempting, if you have already come to the conclusion that you need to borrow and not save, do yourself a favour and don’t tie yourself in longer than absolutely necessary.
Before you do decide on the amount you are going to take out, make sure you are going to be able to make the required repayments. If you have any doubts what so ever about this think very carefully about if this is the right decision. You don’t want to make the repayments span a much longer term resulting in you paying a ton of interest; you will want to intend to pay your loan off as soon as possible.
Before the loan application is accepted you will need to get it authorised by the lender. They will analyse your credit history and determine how much of a financial risk you pose to them. If you have a bad credit history this does not automatically mean you will not be accepted but it will likely mean that you will be paying a higher interest rate for the same loan.
Try to find a loan with a fixed APR, so you know you won’t have any unexpected money going out towards the loan at any point. You will find it easier to reserve money from income to go right towards paying the loan off if you know exactly how much is needed in advance.
Many lenders have customized loans available to customers within the budget you require. Both unsecured loans and secured loans are available to those who need them from a large range of lenders.