Many Help to Buy Initial Borrowers Look to Remortgage
Five years ago the UK government implemented the Help to Buy scheme which was created to help young buyers onto the property ladder or help them reach another rung. This programme is now nearing maturity and those house owners are in line to remortgage. The group of new home owners is also set to start paying interest on the loans. This will automatically increase the amount of their monthly payments to new heights.
The headache for the group acquiring a loan five years ago has only just begun. Rewind time five years ago and there were 23 lenders giving access to the group with funds at the ready. Today, the same group only has 10 total lenders willing to accept a remortgage loan from another lender. From a time perspective, this leaves little time for borrowers to move on the opportunity to acquire a new loan in the form of a remortgage.
Lee Flavin of RateSwitch commented on the latest information regarding remortgage: “Help to Buy homeowners face a financial timebomb from April, with the prospect of rising Government fees and mortgages rates hitting home hard. Struggling families and homeowners could see their costs rise by thousands of pounds a year.”
The government programme Help to Buy has helped thousands of young buyers grasp the first rung of the UK housing ladder. The circumstances the group now faces could be dire if they are not able to act quickly with an application containing all the necessary information.
Flavin added: “For those mortgaged under the scheme, the number of options available to remortgage or switch between lenders is clearly limited in comparison to those mortgaged under normal terms.”