IT was a very busy January and not just for new business!
Many lenders are looking for gaps in the market where they can make a significant difference and offer a product aimed at a type of customer, rather than the normal open market offerings available to all.
Innovation may be the key for a lenders success in 2012 as overall lending volumes are predicted to remain pretty static compared to last year.
Last week, I attended a First Time Buyer ‘round table’ event where lenders, brokers, estate agents and even the mortgage market trade body were in attendance to discuss the increasing issues faced by First Timers.
There’s still no huge appetite from lenders to explore this avenue further as yet, even though everyone agreed this is a major area of concern.
Lenders expressed their continued uncertainty on house prices, which obviously affects their decisions to offer mortgages where only a small (5 per cent+) deposit is required.
Behind the scenes, there are also strict regulatory requirements on funding these specific deals.
However, coincidentally, we have seen some 95 per cent products launched this week, sub 6 per cent and with reasonable fees.
How long they will remain in the market is another question, but for now, that’s a good step in the right direction.
We have seen many lenders increase their rates over the last week following a rise in the cost of funds. Lenders have pulled rates with little or no notice and new products have been launched at higher rates. This has been especially noticeable in the arena catering for those with missed payments, CCJs, or Defaults.
Finally, actually placing a mortgage with a lender is not normally difficult. The hardest part, in the recent climate, is getting the mortgage through to completion!
To assist this, try not to give lenders an excuse to decline your application or refuse to lend to you.
Try to pay bills on time, don’t miss payments, and especially not mortgage payments!
Any missed (or sometimes late) payments will be registered on your credit file and this is normally used as the basis of a decision to lend to you.
Lenders can re-credit search/credit score you right throughout the whole mortgage process.
Dale Jannels - Director AToM Ltd