This advice could relate to the funding required to purchase your next home, improve your current one, buy your first place, or maybe secure one to rent out. Or perhaps it’s simply a desire to take advantage of the decent rates out there, and get a better mortgage deal than the one you currently have. If so, we can help.
Additionally, we can also identify suitable products to protect you (and your family) should you be unable to work, face a serious illness, or worse still, an untimely death. Sober thoughts we know, but in situations such as this, it’s far better to have a policy in place, and not need it, than to need one, and sadly not have it.
Current borrowing climate
Quite apart from the wider implications of Brexit, the General Election fall-out, rising inflation, and the overall economy, much has occurred over the last few years to make it tougher to source a mortgage (or some other types of loan) due to the stricter evidencing of income and the affordability issues. In June, the Bank of England further tightened its recommendations to lenders regarding affordability tests.
For landlords (or for those thinking of entering this arena) there have been even more initiatives, such as higher stamp duty, tax changes, and most recently new stress tests and affordability rules.
However, in the midst of all this – and perhaps partly because of the above – the Bank of England Bank Rate remains very low, and there are some excellent mortgage deals on offer for both buy-to-let and residential borrowers.
It’s not solely about decent deals, as there are a myriad of product choices that can enable us to identify the loan most suited to your needs. For example, you may want to overpay when you can (thereby making savings in the longer-term). And product innovations are not solely confined to loans, it also applies to what’s on offer on the protection front.
Why act now?
Obviously, taking on debt at any time requires consideration, and more so with the current instability. However, for a range of groups, there may be good reasons why it could make sense to act:
– For first-time buyers, there are numerous schemes on offer.
– For the 3-4 million who are on their lender’s Standard Variable Rate (at an average rate of 4.56%*), it may make sense to try to take advantage of the current deals.
– For those coming to the end of 2 or 3-year deals, they may find that rates are generally lower than a few years back.**
– For landlords, and in particular those with 4 or more mortgaged properties, who may be thinking about remortgaging, it might be an idea to consider doing this ahead of more onerous rules from September 2017.
(Sources: * Which.co.uk, April 2016 & March 2017, **Mortgage Brain, comparison of April 2017 vs. April 2014 & 2015)
You may have to pay an early repayment charge to your existing lender if you remortgage.