Don’t believe the mortgage mirage … promises of good schemes to come are not all they seem

Following a turbulent few months in the mortgage market, the promise of further rate cuts may seem something to celebrate but we may be far from in the clear yet. 90% loan to value (LTV) mortgages are fast becoming extinct and houses are increasingly being down-valued in the eyes of lenders so waiting for a lower rate deal to come along could cost you your mortgage.

For thousands of Contractors the recent 1.5% emergency cut has been a welcome relief after months of watching their tracker mortgages creep up, and those that are coming to the end of a fixed term and looking to remortgage should be optimistic of securing a very competitive rate. However, if cutting rates was Darlings idea to get the lending market back on track then there is one fatal flaw in his plan. 80 and 90% LTV’s are increasingly so difficult to come by that unless you are one of the lucky few with a 25% deposit under the mattress then you are unlikely to secure a decent mortgage rate.

Slowly, slowly doesn’t always win the race!
Whilst it may be tempting to sit back and wait for the promised further rate cuts to materialise, LTV’s are getting worse by the day at the moment and it is now virtually impossible to find a lender offering 90% mortgages. The days where you could buy a house with little to no deposit are long gone and unless you have a stash of cash saved up to buy your home or equity within your current home, then you have to capitalise on any opportunity that comes along.

If you are remortgaging an existing property then you could be in trouble. For many there is the threat of your home being down valued so that those Contractors that thought they had, say, £20,000 equity in their home actually have £5,000 in the eyes of the lenders and cannot meet the required LTV to remortgage. If your fixed term is coming to an end and you need to remortgage in the coming months then acting sooner rather than later to secure a rate could be the difference between an affordable mortgage and stretching yourself at an already difficult time.

How can we help?
As Independent Financial Advisors we search the whole of the market to find the most competitive mortgages for our contracting clients. Our experience in the industry has enabled us to build strong relationships with key providers, enabling our clients to benefit from exclusive mortgage deals that would not be available on the High Street.

We are currently able to offer a 90% LTV mortgage with one provider, a rare opportunity in a sea of lenders only offering 75% and under. However, due to the volatility in the market, it is difficult to predict how long this mortgage will be available. Whether you are looking to cash in on the falling house prices and buy a new home, or you are remortgaging your existing property, we can help you secure a competitive mortgage.

Our dedicated mortgage team will handle your application from start to finish and will be on hand to offer advice and guidance when you need it. We recognise that Contractors lead hectic working lifestyles and for that reason we can tailor our service to meet your needs, completing the entire application process either in person or via email, phone or post.

Return to Articles page