Mortgage Advice Even More Essential For Buyers And Investors
There is no denying the COVID-19 pandemic has had a significant impact on the mortgage market. Therefore, anyone considering a property move soon is advised to speak with experts and receive tailored advice for their needs and requirements.
Arranging a mortgage is often a challenging task at the best of times for some people, but when you consider the additional obstacles created by the pandemic, arranging a mortgage is even more difficult.
Implications of the furlough scheme are still being considered, and of course, thousands of people across the country have lost their jobs because of coronavirus. When you apply for a mortgage, you are advised to stabilise your finances and have a period of consistency before making your application. In the current climate, this will be a difficult task for many households.
Mortgage products were withdrawn during lockdown
Of course, there have also been changes in the mortgage market. When lockdown started, there was significant pressure on mortgage lenders. Existing clients were inquiring about mortgage holidays and were looking for guidance on re-mortgaging. When you also consider many mortgage lenders were working with fewer employees, it was obvious that something had to give.
Where lenders cut back was on mortgage products. There was a temporary withdrawal of many of the highest Loan-To-Value (LTV) mortgages. This made it even harder for buyers to find a mortgage, and even though more mortgage products are being added each week, it will take time for a full range to be offered.
This all means anyone looking to arrange a mortgage soon are advised to seek expert help. Working with a skilled and experienced broker is good advice at the best of times for the mortgage industry, but in the current climate, time spent with a broker or financial expert is likely to be time well-spent.
Young buyers are finding additional barriers to arranging a mortgage
According to Zoopla, at the end of June, there were only 14 mortgages available at 90% LTV. This contrasts badly with a total of 386 which were available in January. This will impact the market and further studies by Zoopla suggests a third of prospective buyers under the age of 35 have delayed or halted their plans to move home. A significant proportion of this group has said the lack of high LTV mortgage products as a critical factor in their decision.
However, as stated above, things are changing. One mortgaging sourcing platform states the number of available mortgage products entering the final week of June stood at 9,033. This was a rise of 3.3%. The number of mortgage products on offer in the market is more than 20% higher than the lowest point endured during the lockdown, which occurred in mid-April.
The same source states that the range of products in the below 80% LTV part of the mortgage market, which is likely to attract buyers who can place a large deposit, is stable. Of course, this is only open to a small number of prospective buyers, with options remaining limited for buyers who are looking to pay a deposit of 15% or less.
With so many challenges, arranging a mortgage is tough, but not impossible. If you are keen to arrange a mortgage shortly, speak with an expert who will help you make an informed decision.