For the last few weeks the opportunities in this mortgage market has felt a bit like playing ‘Whack-A-Mole’ as lender criteria changes, interest rates change, and latterly, valuation policies change. But as is always the case, things start to settle down, and you become accustomed to the new ‘normal’.

‘New normal’ is probably the best way to describe what comes next, as I don’t think we will be going back to the ‘old’ way of doing things in a number of areas of our work, or indeed our lives, in certain aspects. But again, I think that is overriding a positive thing. So on that note, I have highlighted some areas below where things are happening which you may not realise was the case:

Property Valuations are getting done

As previously outlined, many lenders have moved to AVMs (automated valuation models) or Desktop solutions, some with greater effectiveness than others. Overall, this has been a huge success as I was not sure a fraction of the valuation that have been carried out would have been. Current limits are around:

• Max £3m property value (but above this can be achieved in certain circumstances)
• Max 90% loan to value (but this is dependent upon property value, type and the strength of certain lenders models/approaches)

We have built, what I believe to be, the most comprehensive matrix of lender criteria on this point which is critical in this mortgage market. If you want to know how this affects you, please ask and we’ll talk you through it.

Property Purchases are happening

Particularly in the last week or so, we have had a number of clients agree new sales. Don’t assume everything is on hold. There are opportunities in this mortgage market. If you have viewed a property previously, or got outbid/an offer rejected, I would urge you to touch base with the agent(s) you were dealing with. For obvious reasons, some sales have fallen through, and properties remain on the market. Some great deals are being snapped up, so if you can move, keep your hand in.

Lender Service is holding up

Other than the odd exception, lenders have coped extremely well. That is largely the broker experience, as things are largely automated in our world. If you tried to approach a bank directly for a mortgage you may struggle, but our experience has been quite positive. Numerous times post lock-down, we have had mortgage offers produced in 24-48 hours. Again, just not possible when dealing with lenders directly.

Secure your next deal early

We will be contacting all our clients shortly that are due to refinance right up to the end of the year. If you are in that window of your deal coming to an end, get in contact. There are opportunities in this mortgage market and we can line up your next mortgage and ensure you don’t miss out on the current batch of very low mortgage rates. If you last took out a mortgage 2 or 5 years ago, there is a marked drop in rates, so cash in now while you can!

Rate Corner Money markets continue to nudge down.  We feel that markets are expecting the UK Base rate to get to 0.5% (up 0.4% from where we are currently) in the next 12 months or so, but that may not actually mean mortgage rates go up. In the last week: 3 Month Sterling Libor = down by 0.191% to 0.403% 2 Year SWAP = down by 0.041% to 0.391% 5 Year SWAP = down by 0.044% to 0.411%

Best Rates: 2 Year Variable from 1.05% 2 Year Fixed Rates from 1.19% 5 Year Fixed Rates from 1.41% BTL Rates from 1.19% The actual rate you will be offered will be dependent on your personal circumstance and deposit level. Please speak to one of our advisers so that they can guide you through this process Source: Twenty7Tec May 2020

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