Remortgage Sooner Rather Than Later is Smart for Many Homeowners
Hopeful home buyers are set to increase mortgage demand in the second quarter. If numbers increase as expected then it will serve as more proof that the UK housing market is in the midst of a growing housing boom. The Bank of England (BoE) released its quarterly Credit Conditions Survey that was conducted between 7 February and 3 March, which calls for higher demand for new purchase mortgages.
First time buyers have been encouraged to step forward with growing economic confidence, the Help to Buy programme and low interest rates from lenders.
According to the latest housing price index from Nationwide Building Society, house prices rose again in March which made it the 15th consecutive month for an increase to the average UK house price.
The Bank of England has issued that they are watching the housing market closely for any instability in the financial market or weakness in the current path to economic health.
Another factor to higher demand for mortgage lending is that lenders have been adding more mortgage products that offer higher loan to value levels with more willing to lend above 90%.
Remortgages have been in higher demand as well with homeowners seeing their equity levels increasing with rising house prices. Homeowners outside of the London area had felt the recession markedly with falling property values and many experiencing going under water with their mortgage. The current rising property values has lifted some from overwhelming burden while others have found they now have the ability to qualify for cheap remortgage deals and the ability to pull out more cash with their new deal.
Some experts have warned that as demand increases, which it is expected to do, lenders will begin to pull their cheapest deals off the market. This will be a response as demand could soon heavily pull on the lending supply available from lenders. Those seeking a mortgage, remortgage or buy to let deal are therefore encouraged to shop around now and decide if sooner rather than later is the time to close on a loan.