The Mortgage Market Review has resulted in new rules being introduced which have put extra requirements on lenders from April 2014. This is already resulting in major slows in processing applications and also is resulting in many lenders starting to raise interest rates on the new mortgages they are offering because of the extra costs resulting from having to implement these rules.
What we are also seeing is generally a tightening up in lending. Cases which would have gone through smoothly in previous years are hitting major obstacles which, in some cases, have resulted in the mortgage being declined. There is also an even greater reluctance to provide new interest only
mortgages. This is bound to impact on the many who still have an interest-only mortgage which is reaching its end.
We will be happy to assist wherever possible with new mortgage arrangements and we are still recommending that those with mortgages on the lender’s standard variable rate should seriously
consider moving to a rate fixed for 3 to 5 years, or longer. We are of the view that interest rates are likely to start creeping up within the next year or so.
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