Welcome to The Mortgage Guide UK
Non Status and Sub Prime Mortgages Non status or Sub Prime Mortgages are often known as bad debt or bad credit mortgages. They have been in the news recently because of America’s problems with its sub prime mortgage market. Sub Prime lending means lending to people with bad credit histories. (e.g. those with missing credit …
In the past tenants were require to hand over a deposit to a private landlord. However unscrupulous landlords often refused to pay back this deposit. The standard deposit can vary between £600 and upto £2000 in London. On 6 April, the Government will introduce the Tenancy Deposit Protection (TDP) scheme takes effect in England and …
In the Short term the buy to let sub market is performing well. Uncertainty over the direction of house prices and interest rates is discouraging more people from buying at the moment. This is increasing demand for alternative renting. Shortage of Supply. Recent studies show there is a chronic undersupply of houses in the UK. …
One of the main reasons for the recent rises in UK house prices is the continued shortgage of supply. When supply is limited it means that only a small increase in demand is required to cause prices to increase. This inelastic supply (supply doesn’t change) also means that house prices are more volatile. i.e a …
Continue reading “Shortage of Affordable Housing still Problem in UK”
Read all the small print. For example make sure you can leave the mortgage deal without incurring any excess penalties. Choose the right mortgage for your circumstance. For example if you have a large current account surplus you should seek to make use of this positive balance and get a current account mortgage. This is …
This has been one of the worst weeks for the Dow Jones for 4 years – the stock market fell 4.2% this week. In particular brokers are becoming more wary of buying risky assets.. In part this stems from worries over the US housing market’s sub prime market. This is basically lending mortgages to people …
Tips to help save tax and penalties from Tax 1. Be aware of your Tax Situation. Learn a bit about taxation it may save you money over the years. Don’t put off looking into tax, even if you dislike the ida. 2. ISA Accounts. Interest you receive is generally liable for taxation unless you save …
PERSONAL FINANCE TIPS 1. ‘Neither a borrow nor a lender be’ Or if you must borrow try get a cost effective deal. Start by asking your bank for an overdraft facility before you need it. Overdrafts only cost whilst you are using them but personal loans have interest charges all the time. 2. Make Sure …
The American Housing market has experienced a significant boom and bust in the past 12 months. US house prices have been rising at a faster rate than incomes and rents for several years. For example the average house price to incomes reached 190% in 2005, compared to 100% in 1952. There are several reasons to …
Gazumping occurs when you have put in an offer to buy a house and at the last moment someone comes on with a higher offer. Legally the owner of the house has the right to change his mind and sell to the highest bidder. However it can be a frustrating business because the process of …
Despite uncertainties over the future of the UK Housing Market, the buy to let sector is forecast to continuing increasing in size. Currently about 330,000 buy to let mortgages are sold per year in the UK, this is forecast to rise to £361,000. By 2011 Mintel forecast the % of buy to let mortgages to …
Continue reading “Buy to Let Mortgates – Increasing Demand.”
Since the unexpected rise in UK inflation predictions for UK interest rates have significantly increased. A quarter point rise is now almost certain at the next monthly meeting. IN the medium term interest rates in the UK could rise to 6%, previously they were expected to peak at 5.5%. However it depends on how UK …
With current UK growth forecasts of 3% it seems highly speculative to start talking of a recession in the UK. However there are certain factors that cause an element of concern. Recession in UK could occur 1. Fall in the Savings Ratio. Excluding pension contributions the UK savings rate has dipped below 0. This means …
Continue reading “Is UK recession likely to occur 2007 or 2008?”
If you would like to ask a question about Mortgages, the UK housing Market, Finance or Economics feel free to leave a comment on this blog entry. I will try to answer in a new blog post. Note: I am not a qualified mortgage advisor; I teach Economics and have gained a knowledge of different …
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Lifetime Tracker mortgage Remove the hassle of remortgaging with our great value Lifetime Tracker mortgage rate – now with an optional cap to protect you from interest rate rises. * Borrow 80% of the value of your home * No early repayment charges so you can make overpayments whenever you want * Subject to a …
Is it possible to get a £200,000 – £250,000 mortgage on a relatively low income? The traditional approach to mortgage lending was for banks to give 3 times income. This means to get a £200,000 mortgage you would need to earn an average salary of £67,000 a year. If you have a partner, the bank …
Continue reading “Getting a £200,000 Mortgage on Low Income.”
Traditionally the average UK mortgage was based on a standard variable interest repayment mortgage. In recent years, financially liberalisation, has encouraged a range of non-conventional mortgages. In particular, the UK has witnessed an increase in the following types of mortgages: Interest Only Mortgages. This mortgage is aimed at first time buyers, struggling to meet the …
Despite the recent fall in UK CPI inflation to 2.8% there is evidence of increasing underlying inflationary pressures in the UK. Growth last year upgraded to 2.9% (Source: office of national statistics) OECD raise forecast growth rate to 2.7% (slightly higher than the UK’s long run trend rate of growth) Rising wage settlements (2% in …
The Bank of England recently increased interest rates for the forth time in 9 months to 5.5%, thereby increasing the cost of mortgages. The prospects for future interest rates are mixed, although most commentators expect rises in the short term. April inflation figures showed that inflation has fallen back within the governments inflation target of …
Evidence of a cooling housing market increased yesterday, there is evidence that the number of new mortgage approvals has fallen quite sharply. The Bank said the number of approvals – loans for house purchase agreed but not yet made – fell to 111,000 from a downwardly revised 117,000 in February. That was the lowest since …
Continue reading “Mortgage Approvals in 2007 fall to new low”
The definition of sub prime mortgages is open to interpretation. However, sub prime means that the borrower has at least some degree of bad credit history. Sub prime mortgages are also known as adverse credit mortgages. The quantity of sub prime mortgages has been increasing in the UK. This includes people who have near prime …
The UK is experiencing population growth in the UK, because of rising immigration. Part of the reason is due to the expansion of the European Union into the East. This means workers from Poland, Czech Republic, Bulgaria and Slovakia are now able to move to the UK, to take advantage of higher living standards. However, …
What happens when house prices fall: Conventional wisdom suggests that falling house prices would be a disaster for homeowners and the economy. For example, a 10% fall in house prices could knock £20,000 of the average UK house price. Such a fall in wealth is likely to reduce consumer confidence and spending. This fall in …
Continue reading “Should we worry about falling house prices?”
I would be interested in reading your thoughts on the following post. Basically she says the credit crunch is not really a subprime problem but an ARM problem. What do you think?- link to article: All business.com It is certainly the case that the problems in the US Housing Market are partly due to ARM …
Northern Rock, is one of the UK’s top 6 mortgage lenders. It has built its business around mortgage lending, rather than promoting building society accounts. Northern Rock has also been one of the most willing financial institutions to give unconventional mortgages. It has also taken on a significant amount of adverse credit mortgages. However, yesterday …
Continue reading “Are Mortgage Lenders likely to go Bankrupt?”
Personally, I feel that interest rates are likely to fall slightly next year. – See interest rate predictions However, if your circumstances favour a fixed rate for security and peace of mind. Halifax are offering upto 25 years fixed. A one year fixed rate is at 6.64% for introductory period followed by 7.75% for the …
There has been a lot of talk recently of the sub-prime crisis. However, many are uncertain of what we actually mean by ‘sub-prime’. Sub prime is more common in the US. In the UK, we are more likely to talk about the adverse credit or bad credit mortgage sector. However, the recent interest in the …
What happens to a mortgage if the lender goes bankrupt and you are paying a mortgage on that property? – Reader Question If a building society such as, The Northern Rock, was to go bankrupt your legal requirement to pay back your mortgage remains. However, you will be paying back your mortgage to a different …
Continue reading “What Happens if your Mortgage lender goes Bankrupt?”
The number of people with bad credit histories (also known as adverse credit histories) has increased significantly in recent years. This is due to several factors. 1. Increased choice of financial products available for sale. There are numerous products and opportunities for borrowing money. With increased choice of borrowing options, it is not surprising that …
Continue reading “Why the Number of Bad Credit Mortgages has Increased”
The largest mortgage lenders in the UK, according to the Council of Mortgage Lenders statistics Top 10 Largest Mortgage Lenders HBOS – Mortgage Balances – £220bn – Market Share 20.4% Abbey National – £101bn – 9.4% Lloyds TSB – £95.3 bn – 8.8% Nationwide – £89.6bn – 8,3% Northern Rock – £77.3 – 7.2% Royal …