The big news of the week was Halifax making a return to lending at 90%, which now means they welcome back buyers with a 10% deposit. So small mortgage deposit deals are back!
Since the onset of Covid, the smaller deposit market has really taken a battering, which always hits First Time Buyers hardest, but also affects all forms of borrowers.
In practice, we have had access to lenders who will go up to 100% of the property value, and have done for years (which often require parental/family input of some kind). But it is great to see the largest lender in the UK coming back with standard products at this level.
Of the lenders that do offer mortgages with a small mortgage deposit, they have been charging a premium as so many other lenders have pulled back. This is a very welcome return to some competition in this area which will only start to drive pricing down in due course.
House Buying Guide
With so much house buying activity ahead of the Stamp Duty holiday coming to an end on 31st March next year, we have taken the time to consolidate some previous posts into a house buying guide, which covers off:
- How much can I borrow?
- How does Buy To Let work?
- What Role does the mortgage valuation play?
- How does your credit score affect the mortgage you get?
- How can you protect your mortgage?
So if any of that is of interest to you, you can see the full article on this here
Market rates remaining quite flat at present. As touched on above and in previous emails, it is the capacity (and lack thereof) in the mortgage market which will drive pricing. That has been going up for months now and shows no real sign of reversing that trend, so we still feel keeping your mortgage options short term will save you the money money in the long run.
In the last week:
3 Month Sterling Libor = down by 0.004% to 0.037%
2 Year SWAP = up by 0.002% to 0.090%
5 Year SWAP = up by 0.011% to 0.271%
Bank of England Base Rate = Held at 0.10%
2 Year Variable from 1.19%
2 Year Fixed Rates from 1.04%
5 Year Fixed Rates from 1.32%
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 December 2020