Welcome to the July 2009 Issue of the Mortgage Broker Newsletter.
July has proved to be a good month so far, both for consumers and for our own company.
In the mortgage market we have seen lenders dropping the price of their fixed rates on the residential side, which has been a long time coming. The newly priced fixed rates will be shown in our best deal of the month, further down in the newsletter. Unfortunately there has been no such movement in the buy to let market with the lenders who operate in the segment of the market crying out for some new competition to take some demand away from them.
Also for consumers we have seen the launch of a new guaranteed savings bond (Click Here For More Info) which gives up to a 79% return on your initial investment, subject to the performance of the stock market, but which gives you the peace of mind and GUARANTEE that your initial investment is 100% safe with no risk to your savings. So if you are frustrated with the current returns you are getting from your building society or bank, then I suggest you take a look at this alternative as it seems to tick all the right boxes.
We have also re launched our FREE buildings and contents insurance offering. It’s quite simple, with no catches or small print, if your current insurance is due for renewal then take advantage of what our insurer is offering. Its well priced and award winning and they know that some of you will take the free insurance and then ask us to cancel it once the ‘honeymoon’ period is over. (They also hope that the policy will be cheaper for some applicants and that the policy will stay in force – hence the incentive!)
On a final note, in the last two weeks The Mortgage Broker Ltd has won the following prestigious awards, so I would like to say a big thank you to all of you who took the time to vote for us:
2009 What Mortgage Awards – Winner of the “Best Regional Adviser”
2009 British Mortgage Awards - – Finalist and highly commended in “Best Specialist Adviser”
2009 What Mortgage Awards – Finalist and highly commended in “Best buy to Let Adviser”
2009 What Mortgage Awards – Finalist and highly commended in “Best Specialist Adviser”
Mortgage Deals of the Month
Every month our advisers scour the whole of the market to bring you what they consider to be the best mortgage deals currently available. As you know lenders change their rates on a frequent basis so don’t hesitate to contact us if you are looking for a new mortgage or wanting to change your existing deal for a better one.
The Best Residential Mortgage Deal for July is…
3.99% fixed until 31/10/2011
£638 per month based on a 25 year repayment remortgage for £120,000 on a property valued at £200,000. 70% maximum loan-to-value, £999 lender arrangement fees added to the loan, the deal reverts to a tracker plus 1.49%. The overall cost for comparison is 2.5% APR. An Early Repayment Charge of 3% of the outstanding loan is applicable up until 31/10/2011. Free legal fees and a Free valuation also included.
To grab this great deal while its still available please call one of our specialist advisers quoting "JulyDeal" on 0845 6076193 or click here to fill in a brief enquiry form and we will get back to you within 30 minutes.
The Best Buy to Let Mortgage Deal for July is…
4.99% fixed rate until 02/11/2012. The deal then reverts to the Bank Base Rate plus 1.99% for the term of the mortgage. The deal comes with a valuation fee of £300 and legal fees.
£500 per month, based on a 120k mortgage on a 200k property interest-only over 20 years, 1.25% lender arrangement fee added to the loan, maximum 60% loan-to-value, the overall cost for comparison is 3.1% APR. An Early Repayment Charge of 6 months interest until 02/11/2012. Please note you must move a portfolio of at least 3 properties to the lender to secure this rate.
To grab this great deal while its still available please call one of our Buy To Let specialist advisers quoting "JulyDeal" on 0845 6010153 or click here to fill in a brief enquiry form and we will get back to you within 30 minutes.
Fix Before Its Too Late
For a year now fixed rates have been as low as they have ever been – an all-time low Bank of England base rate meant lenders were able to lend at lower rates than ever before. But things are beginning to change, and it truly is crunch time for those who were considering locking in their mortgage while the going is good.
You may not have wanted to fix your mortgage for the last couple of months, and who could blame you if you were on a variable or tracker rate mortgage? While the base rate sits at 0.5%, those on a standard variable rate or those on a tracker rate only have to pay a few percentage points above 0.5%, if that. Homeowners up and down the country have been enjoying mortgage cuts of hundreds of pounds every month. Some have been able to clear debt, some have been able to overpay on their mortgage and some have been able to spend a little more freely.
And, while people were enjoying super low variable rates, the fixed rates on the market were also shrinking – an average two-year fixed rate mortgage went down by almost 2% in just six months by the start of 2009*.
But the tides are turning. The money markets, which dictate the price of new mortgages, are picking up. Government bonds, on which everything is based, have been rising considerably over here and in the USA over the last couple of months, and as their yields rise so do mortgage rates. Many experts have predicted that we have hit the bottom of the fixed rate market and are beginning to go back the other way.
At the start of last month, an average two-year fixed rate was at 3.56% but then in just 11 days that rose to 3.62%* - the first time rates have risen since the Bank of England began reducing the base rate. The clock is definitely ticking.
But the base rate is still low and tracker and variable rates are still cheap so why worry? You should worry because nothing is permanent, and the Bank of England will decide to increase the base rate from 0.5% at some point. It might not be for six months or even a year but when it does, it may decide to increase the rate quickly, which would mean a big rate shock for those on variable or tracker deals.
But where do people turn if they are caught short? Not to fixed rates - by then fixed rates will have increased also, leaving them with few cheap mortgage options.
But there are still cheap mortgage options now. Fixed rates have only just begun to increase – the average three-year fixed rate is still falling, albeit at a slower pace*. So you still have chance to fix in now before it’s too late. Talk to a mortgage adviser about getting locked in for the short, medium or the long term, it might be the best financial decision you make for a long time.
SOURCE: * Moneysupermarket.com, 12/06/09
Get Your Free Credit Check
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Click here to get your free Experian credit report online
First-Time Buyers Need Advice
A news study has found that nearly half of all consumers looking for a mortgage adviser were first-time buyers, proving how important advice is to those who have never had a mortgage.
The study by Unbiased.co.uk found that many people looking for help with their mortgage were first time buyers, while nearly a third were those looking to re-mortgaging, as homeowners continue to seek advice on the best deals, releasing equity and whether to fix or not to fix in the current climate.
David Elms, chief executive of Unbiased.co.uk, says: “Last month’s study demonstrates that as first-time buyers and homeowners find themselves confused by the continually changing mortgage market, they are putting their faith in whole of market mortgage advisers.
“In the current climate, consumers need expert advice to get the best deal for them and a whole of market mortgage adviser is best positioned to serve these needs. Only whole of market mortgage advisers can give you advice and recommend solutions and products from across the range of mortgage providers.”
This isn’t surprising; people who have never experienced what it is like to have a mortgage need some guidance. They need to know what to expect each month, they need to know what they can do with their loan and they also need to know what restrictions a mortgage brings. Only a mortgage adviser can give this sort of advice - if you are considering taking your first steps onto the UK property ladder or know someone who needs a helping hand, talk to a mortgage adviser right away.
SOURCE: Unbiased.co.uk, June 2009
