More Mortgages Hit the Market….

by Mark Johnston

More Mortgages Hit the Market….

For the first time in a long time there now seems a wealth of options available in the mortgage market.

It appears that mortgage finance is now typically easier to obtain for the majority home owners and also in the last few months new lenders have launched to cater for people with patchy credit histories or even county court judgements to their names.

keys-credit-lgCompetition between mortgage lenders has now meant that borrowers can start picking and choosing the best deals.

Jonathan Harris of mortgage broker Anderson Harris says: “The mortgage market has definitely reopened for business, with a significant increase in the number of deals available to borrowers.”

The number of mortgages available has topped 3,500 for the first time since the financial crisis.

Financial information group Moneyfacts says that there are now 25 per cent more mortgages available than a year ago, and most of these are at lower, more affordable rates with looser criteria.

Therefore, house buyers can now take their pick of mortgage deals as there is more available now than any time since the financial crisis.

According to the Council of Mortgage Lenders (CML), lenders advanced close to £17 billion of mortgages in July up 30 per cent year on year from £13 billion in July 2012.

It seems that the Government’s introduction of the Funding for Lending Scheme (FLS), which gives lenders access to cheap funding, has triggered dramatic falls in the cost of fixed rate mortgages.

Therefore, some financial experts feel that fixed rate mortgages could fall even further if lenders have to work a bit harder to convince borrowers to lock themselves in when interest rates are unlikely to rise until 2016.

In light of all this news the bank of England has also suggested that many lenders are expecting to advance mortgages at higher loan to values.

Current data has revealed that the number of mortgage borrowers securing loans with smaller deposits has jumped 47 per cent in one year.

Trinity Financial communications manager Aaron Strutt says “It is fair to say there are more mortgages available to borrowers with less than a 25 per cent deposit. It was not very long ago that brokers could not place clients with a 10 or 15 per cent deposit, but there are now more options.”

Richard Sexton, director of E.surv chartered surveyors, added that “borrowers with smaller deposits fell out of the bottom of the market when the financial crisis hit, but they are returning now in their droves”.

Although, Mortgage and protection advice firm Moneysprite managing director Ashley Brown states “Lenders should be applauded for their drive to offer value across all loan to values”.

Recently, Halifax, Virgin Money, Metro Bank and Chelsea Building Society have all reduced rates or introduced new products to their mortgage ranges.

In conclusion, all in all it seems that access and availability, the two keys to the mortgage market, have improved. But the question still remains that if initiatives have been propping up the market, what happens when these initiatives are removed?



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