Remortgage Market Sees Best Performance In A Decade!

It’s that time of year when January’s past, people are settled in, and we can finally take a bit of a hiatus to take stock of what’s happened so far in 2024.

A lot has happened. A lot is happening. A lot is going to happen.

Anyone with a mortgage will know about November’s interest rate increase. It was marginal, but it was a market shaker.

It spurned tens of thousands of homeowners into action, who now have locked in some of the best deals in years.

Remortgage approvals have reached their highest level in a decade. The Bank of England reports that the total remortgage market’s worth is £7.3 billion, a 15.9% increase from 2023.

Was the Interest Rate Hike All that Influential?

A 0.25% rate increase is hardly monumental news. What is though is that another two such increases in the next three years are likely to happen. Most of those who chose to remortgage now have opted for a longer-term fixed rate, with the 5-year fixed term proving the most popular.

The Easiest Way To Your Remortgage

The boom in remortgages is driven by inflation.  Last year saw a rise of 3.1% added to the cost of living. Cash was being stretched, and with an interest rate increase on the horizon during pre-festive season, homeowners began checking their finances and looking at ways to cut costs. The banks and mortgage providers didn’t half deliver.

The biggest winners of the low rates on fixed-term deals were those already on a standard variable rate. According to Moneyfacts.co.uk, the highest SVR was 6.08%. This is an astonishing rate for anyone, particularly those with over 50% equity in their home. With that amount of equity, getting rates under 2% was possible. Even without a 50% ownership, the average rate is 2.35% on a two-year fixed-term remortgage.

The Unlucky Losers in All of This

Buy to Let remortgage finance is still taking a pounding. That market has stagnated, but then again, it was expected. Landlords have faced a barrage of tax changes and legislative issues since the start of 2023. UK Finance anticipates that the Buy-to-Let residential mortgage market will remain stagnant for the next few years.

For those who already have Buy-to-Let finance, the terrible news is there’s a sharp increase in the number of defaults. That’s up 20% from November compared to the number of defaults last year. That’s for significant defaults of 10% or more. A total of 1,200 properties faced significant defaults in the last quarter.

The property prices in London, in particular, are causing some serious problems for property owners who took repayment only mortgages in the ‘90s. Since then, property prices have fluctuated massively, leaving property owners having difficulty selling for a price that will clear the amount they owe.

The Low Rates May Just be About Over Though

The massive cuts to interest rates were not the banks’ decision to be kind. The Bank of England has funded most loans secured through banks and building societies. When the base rate drops, so too does the cost to banks, as they can borrow from the Bank of England (BoE) at more favourable rates.

The BoE designed the Term Funding Scheme to encourage people to borrow again and stimulate market growth. Over £100 billion was made available to banks to facilitate lower-interest funding. The scheme will end on February 28th.

There’s no telling what will happen in March; however, the speculation is that there will be increases. Whether it’s March or further into 2018, we’ll have to wait and see.

We can predict that the interest rates won’t be this low for much longer. Banks are in the game for the money. When overheads rise, expect the market rates to follow suit shortly after.

With the Term Funding Scheme ending and the BoE stating that there may be another rate increase by the Spring, it’s impossible to imagine the remortgage rates remaining as low as they have been, especially in the few months from November.

The Consumer Market Shows Signs Already of Bouncing Back

Nationwide withdrew free legal fees last year for existing customers remortgaging. Just last week, they announced the return of free legal conveyancing or a cashback offer of £500, which is £250 more than was on offer.

The chain has a kink, though, as it’s not the same service as before. That’s a good thing. The firm’s legal services used to be provided by LMS, but there have been reports trickling through the broker community that they couldn’t cope with the demands. Instead of one outsourcing firm, Nationwide has chosen to use a half dozen legal conveyancing firms this time around.

They appear to focus on the London housing market rather than remortgaging. First-time buyers, predominantly as the building society, also announced a higher loan rate for first-time buyers of 95% LTV for up to £350,000 property valuations, which is £100,000 more than previously.

It’s hardly surprising, though, that they would up the loan amount that can be borrowed given the house prices and the amount of money going from London property owners to the banks and building societies with interest. These figures explain why the rates can be lowered so much.

Some new lenders are offering secured loans for bad credit, appearing in 2024, and there are rumours of some relaxation of affordability calculations for secured loan products as many believe they are too strict.

Check the figures for the past quarter from trade body UK Finance:

• The London remortgage market is worth £4.49 billion
• In Scotland, £980 million of remortgages were secured
• Wales had £560 million in remortgages
• And Northern Ireland £220 million

In October alone, the Bank of England reported 51,593 approvals for remortgages, including those with adverse credit. That’s a 7% increase, making it the largest number of approvals since 2008. This is a significant milestone for the housing markets around the country. No region around Britain saw a decline in approval rates or a downturn in remortgage applications.

The BoE’s November increase of 0.25% gave the market a running start. Homeowners welcomed the move and locked in some of the best deals around for a long time, with the five-year fixed deal proving to be homeowners’ choice.

Anyone’s guess is what happens in the next quarter, but a good one is that low interest rates won’t be around much longer after February 28th.

Understanding Unencumbered and Remortgage Valuations in the UK

The property market in the UK has its fair share of terminology and complex procedures. Among these terms are “unencumbered mortgage,” “unencumbered mortgage,” and “remortgage valuation.” Understanding these concepts is vital for anyone navigating the property market efficiently.

What is an Unencumbered Mortgage?

An unencumbered mortgage is a property free from any financial ties or loans. In simpler terms, it’s a property owned outright without any outstanding mortgage. This means the owner has 100% equity in the property. Such properties can offer the owner much flexibility, especially when they want to move homes or secure another loan.

When you hear about the Natwest homeowner loan, known as the Natwest Loan Contact, you should know that an unencumbered property can be used as collateral. It can enable the homeowner to access more significant loan amounts due to the full equity in the property.

Unemcumbered Mortgage

A common mistake is the mis-spelling of “unencumbered” as “unemcumbered”. While searching for mortgage options, ensure you use the correct term to find the appropriate information or offers.

Dive into Remortgage Valuation

Remortgage valuation is a process where a property’s value is reassessed, typically when the homeowner wants to remortgage their property. This is done to determine the property’s current market value, ensuring the lending institution is not lending more money than the property is worth.

If you’re considering remortgaging, you might come across offers such as home improvement loans nationwide, also referred to as Loans Nationwide. These are often attractive options for homeowners wanting to improve their property without tapping into their savings.

Remortgage Conveyancing Quotes

Remortgage conveyancing quotes are estimates provided by conveyancing solicitors detailing the costs involved in the remortgage process. It’s always advisable to shop around and get multiple quotes to ensure you get the best value for money. Those in the Cambridgeshire area might specifically look for conveyancing solicitors in Peterborough to find local experts.

The Importance of Final Checks

“Do mortgage lenders do final checks before completion in the UK?” is a common query. The answer is yes. Before finalising a remortgage, lenders often do final checks to ensure there hasn’t been a significant change in your financial circumstances. This might include checking if you’ve taken on new debts or if your employment status has changed.

Transfer of Equity Conveyancing Quotes

A transfer of equity involves changing the legal ownership of a property. If you’re considering this route, obtaining transfer of equity conveyancing quotes will give you an idea of the costs involved. Just like with remortgaging, it’s essential to compare quotes to ensure you’re getting the best deal.

Exploring Unencumbered Mortgage Providers in the UK

With an unencumbered property, homeowners in the UK have the advantage of choosing from various mortgage providers. These providers offer competitive, unencumbered mortgage rates, making it easier for homeowners to find a deal that best suits their financial situation.

Best Remortgage Deals in 2024

As the property market evolves, so do mortgage deals. Those looking for the best remortgage deals in 2024 must monitor the market trends and offers from different lenders. For instance, RBS remortgage rates might be competitive, but it’s always a good idea to compare with other lenders to ensure you get the best rate.

Compare The Market Remortgage

If your search for compare-the-market remortgage deals is a struggle, you could consider cheap detached houses for sale and not have a mortgage at all.

Securing Loans

If you’re in the market for a secured loan, you might come across offers like the 10-year secured loans under the 10-Year Unsecured Loan subheading. On the other hand, if you’re looking for competitive rates, checking out the loan engine, which is mentioned as Secured Loan Interest Rates, can be beneficial.

Moreover, institutions like TSB offer various loan options. If you’re considering a car loan, understanding the TSB car loans, which fall under the TSB Decision In Principle subheading, can provide insights into the bank’s offers.

Bad Credit Remortgage issues in March 2024 and into 2025

Understanding the intricacies of unencumbered mortgages, remortgage valuations, and related terminologies is essential for UK homeowners. By keeping abreast of the latest trends and offers, homeowners can make informed decisions that best suit their financial needs and aspirations. Whether you want to remortgage, take out a new loan, or explore the best deals, a comprehensive understanding of these concepts will serve you well.

Bad credit remortgages represent a financial solution for individuals facing challenges with their credit histories, seeking to adjust the terms of their existing mortgage or to consolidate debts. This economic strategy is tailored for those who have encountered difficulties maintaining a pristine credit score for various reasons, such as missed payments, defaults, or County Court Judgments (CCJs). The nuances of lousy credit remortgages are multifaceted, involving higher interest rates, specific lender requirements, and the potential for improved financial management.

Lenders assess risk differently, meaning that while some financial institutions may hesitate to offer remortgage options to individuals with adverse credit, others specialise in these financial products. The interest rates for bad credit remortgages are typically higher than standard remortgages. This rate increment compensates for the heightened risk lenders perceive when dealing with individuals with a history of credit mismanagement. However, the specific rate offered can vary significantly between lenders, influenced by the severity of the credit issues, the loan-to-value (LTV) ratio, and the current financial stability of the applicant.

The process of applying for a bad credit remortgage necessitates thorough preparation. Prospective borrowers should obtain a detailed credit history report to understand the specific elements affecting their application. Engaging with a financial advisor or a mortgage broker with experience in adverse credit financial products can provide invaluable guidance. These professionals can offer insights into which lenders might be most receptive based on the individual’s unique credit profile and economic circumstances.

Moreover, applicants should be prepared to provide comprehensive documentation to support their application. This includes proof of income, recent bank statements, and details of existing debts and financial obligations. Lenders use this information to assess the borrower’s affordability and decide whether to offer the remortgage.

The benefits of securing a bad credit remortgage can be significant for individuals. It offers an opportunity to consolidate debts, potentially reducing monthly outgoings and simplifying finances. It can also provide a pathway to repairing one’s credit score over time, assuming that repayments on the new mortgage are made consistently and on time. However, it’s important to consider the long-term implications, including higher interest costs over the life of the loan and the potential impact on home equity.

While bad credit remortgages come with challenges and higher costs, they also offer a lifeline for individuals looking to regain control over their financial situation. Careful consideration, preparation, and professional advice are crucial steps in navigating this complex financial journey, aiming for a stable and more secure financial future. Remortgage Market Sees Best Performance In A Decade is a common theme in 2024.