Mortgages

[wakeytom]

US is absolutely spot on here which as a mortgage advisor with his finger on pulse I would expect him to be - Jan-May, transaction volumes (and prices) definitely large hinting at a small bubble but in last 6 weeks there has been a very definite slow down and the Mortgage Review is behind that - the banks simply cannot process the applications efficiently now so things are taking longer. Without a healthy property market this City would struggle big time as there is no doubt in my experience that it is almost exclusively property that drives the feel good factor here. Carney and the Bank should focus on central London, that's where the crazy prices are happening, but down here (and like most of the country) I'd say prices are a little bit above average but even if we had a small crash again, I doubt anyone buying now would be much out of pocket. Classic supply and demand this city, loads of demand, not enough supply hence we will always have a property market that keeps on going through the inevitable cycle of booms and busts. Interest rate rises, whilst painful, don't really have a massive impact for this reason i think but for those wanting certainty there are some great deals out there.

London cannot be taken in to account when you look at the UK mortgage market, why would the banks focus on central London when they are not funding it - the majority of central London sales are to wealthy non-doms who are paying cash so your view that Carney should focus on that market is simply not correct.

 

[Uncle Spielberg]

London cannot be taken in to account when you look at the UK mortgage market, why would the banks focus on central London when they are not funding it - the majority of central London sales are to wealthy non-doms who are paying cash so your view that Carney should focus on that market is simply not correct.

Agreed, most of the UK are only just about where they were in 2007 again. I have sold recently for £ 2500 more than the property was valued at in 2006.

 

[wakeytom]

Rates will go up but I think it will be a long long time before there is any significant shift or if the government get shot of Mark Carney. It's interesting that every time there is rumour of a rise Carney pours cold water on the speculation: first is was his three rules, then he said the three rules could be met but a rise would only happen if the economy could still handle it, then he made the noises about other tools to dampen the housing bubble. I would not be suprised if we are still only at 1% in 5 years time.

Fully agree on the 5 years there! They set themselves simple rules to follow and if the KPIs were hit then we would have a rise, they hit them and still didnt want to rise so instead have kept adding in extra variables so now it is clear as mud and in reality it is back to a gut feel as appose economic factors.

 

[Herr Tubthumper]

Oh agreed - I was surprised they backed own. It does seem wrong that a single persons word is so powerful it can stop you in your tracks. My brother even tried complaining about the survey but the lender wouldn't hear a bad word said about their surveyor.

I think it is down to each lender. Some welcome discussion and some do not. I have recently released some equity from mortgage I have with Saffron Building Society. We were initially stopped in our tracks when it emerged that Frau Tubthumper had a black mark on her credit rating due to indentity theft; we only realised this when we applied for the mortgage. Research showed this is a show-stopper. We reported the fraud to the police and the bailiffs and talked to the underwriters.....and crucially demonstrated it was clearly not us. Saffron were quite cool about it and after further discussions they waived the lending through. I have heard other lenders operate a more "computer says no" approach and would need the black mark removed before proceeding; it took us 6 months to get Frau's credit rating back to normal.

 

[chimneys]

This is very rare to be honest. They have redress against their appointed surveyor but not an independent one. Hence lenders appointed surveyors tend to be cautious as they don't want to be sued for over valuing a property if it goes tits up.

I have a different take on "down valuing" in a rising market. A chartered surveyor can only base his/her opinion on completed transactions, not a gut feel on the way the market is going, or rumours of other under offer prices in the area. It is therefore often very difficult for the valuer to value up at the sale price, if that sale is setting a new high for the market, which is what is regularly happening at present.

This is particularly the case where properties are unusual/have little in the way of comparable evidence of similar properties upon which to base a value.

 

[bomber130]

imo, anyone tying themself to a £111,000 (+ another 70% or so) debt for the next 14years is mad.

saying that the UK IR is going to go up starting next year - this is not the time to max oneself out with a mortgage.

banks will be the new estate agents in 4 years.

With my current income just over 38k and a hundred grand equity in my property would you suggests I rent and pay for someone else's property. Unless you know anyone letting out a house for nothing if so let's know please.

 

[maltaseagull]

Unless you want to sell within 5 years and not buy again, the 5 year fixed imo is a definate from those 2 options. Metro Bank will do 3.09% fixed for 5 years with a free survey and free legals. * generic depends on circumstances *

Never trust advice from someone who cannot spell DEFINITE!

 

[Uncle Spielberg]

Never trust advice from someone who cannot spell DEFINITE!

 

[Bozza]

It's interesting that every time there is rumour of a rise Carney pours cold water on the speculation

Really? http://www.bbc.co.uk/news/business-27827037

 

[Uncle Spielberg]

I do worry that people now assume interest rates will be 0.5 - 1% for their lifetime. The rate should not be 0.5%, should not have stayed at 0.5% for as long as it has and is mean't to be an emergency rate, not the norm.

 

[CheeseRolls]

he is right.

Does seem a little bizarre to me, when all the surveyor has done, is drive past the front of the house. Basically they could find out more if they just to a look on Google Earth, but of course then the banks would be holding all of the risk. If the property is not typical for the area and there are good reasons why the valuation should be higher, it might be worth fighting this one.

 

[Monsieur Le Plonk]

Really? http://www.bbc.co.uk/news/business-27827037

I'm guessing those fixed rate mortgages discussed earlier in this thread are now either unavailable or have significantly different terms. Hope the OP got himself signed up and ignored those who suggested against the fixed rate option.

 

[Herr Tubthumper]

I'm guessing those fixed rate mortgages discussed earlier in this thread are now either unavailable or have significantly different terms. Hope the OP got himself signed up and ignored those who suggested against the fixed rate option.

I wonder how much of this was Carney forcing the government's hand for more power though. The minute he says rates will go up "sooner rather than later" Osborne announces he will give the bank more power and "a full range of alternatives to higher interest rates as a way of cooling down the housing market."

 

[Bozza]

Does seem a little bizarre to me, when all the surveyor has done, is drive past the front of the house.

Not so - we paid more for more than just a valuation. The survey report is pretty detailed.

 

[CheeseRolls]

Not so - we paid more for more than just a valuation. The survey report is pretty detailed.

Ok my misunderstanding. I assumed this was a standard mortgage valuation.

 

[Biscuit]

I'm currently in the process of buying a house. I'm budgeting for a rate rise, prepare for the worst and hope for the best seems to be the best mentality when saddling yourself with hundreds of thousands of pounds worth of debt..

Also paying a huge amount for the survey as I want it detailed. It protects me should anything go wrong later on down the line and is a useful tool should the buyer engage in any funny business when we're due to exchange.

Can't wait to move back to East Sussex!

 

[Bold Seagull]

Also paying a huge amount for the survey as I want it detailed. It protects me should anything go wrong later on down the line and is a useful tool should the buyer engage in any funny business when we're due to exchange.

Can't wait to move back to East Sussex!

The survey makes you aware of any (not all) potential problems further down the line, not sure what you mean by protects you other than giving you a heads up?

 

[Herr Tubthumper]

I'm guessing those fixed rate mortgages discussed earlier in this thread are now either unavailable or have significantly different terms. Hope the OP got himself signed up and ignored those who suggested against the fixed rate option.

Interestingly the opposite. A 2.5 year fix I'm looking at with Godiva went down 0.46% last night.

 

[Biscuit]

The survey makes you aware of any (not all) potential problems further down the line, not sure what you mean by protects you other than giving you a heads up?

That's what a basic survey does, yes. A basic survey is only to satisfy the lender that the house is at least worth what they're lending you. I'm having a full survey, so should something arise later, which should have been spotted in my full survey, but wasn't, then I can ask some very serious questions of the surveyor/possibly even start legal proceedings if the miss was obvious and substantial enough to warrant negligence.

 

[sten_super]

I am in the process of remortgaging, and have been surprised by just how many fees there are to pay. All-in we're looking at just over £2,500 in product fees, conveyancing fees and disbursements. However we've done all the sums and the deal (and the certainty of moving from variable to fixed rate) makes it all worth while - just a bit galling!

I suspect we're now going to have fun (or not) going through the interview process with our chosen lender (Post Office/Bank of Ireland UK) as the Mrs is pregnant.