Posts with tag: remortgage loans

Gross remortgage lending down by 17%

Published On: September 24, 2015 at 12:47 pm

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New data from a report conduced by LMS indicates that the total value of monthly gross remortgage lending dropped by 17% to £4.2bn. This was in comparison to July’s figure of £5.1bn and June’s higher total of £5.3bn

Additionally, the report highlights the typical amount of equity withdrawn from remortgaging per customer rose to £35,590 in the last month, with borrowers looking to take advantage of competitive rates.[1]

Record

This figure represents a new record high and a 30% increase on the previous month, when the average amount was £27,315. In addition, it is 76% greater than in August 2014, when the average amount stood at just £20,219.[1]

Affordability was found to be manageable after a 3% annual increase in wages outstripped the slight rise in average mortgage rates. These rates rose to 2.57% in July, from 2.56% in June. With highly competitive rates enticing borrowers to remortgage, the gap between new purchase mortgages and remortgage payments as percentage of income has risen.[1]

Annual remortgage repayments accounted for 17.9% of income, compared to 20.9% for new purchase repayments. This 3% difference was the largest gap since July 2012.[1]

The LMS report also shows that the number of remortgage loan rose by 18% from 22,900 in August 2014 to 27,080 in August 2015. This was still 13% lower than the number of remortgages recorded in July 2015, after remortgage lending slowed following two extremely strong summer months.[1]

Gross remortgage lending down by 17%

Gross remortgage lending down by 17%

Cashing-in

‘Rising house prices and low interest rates mean homeowners are withdrawing record sums of cash from their homes by remortgaging without impacting their loan-to-value as evidenced by a drop in new LTV’s from 55% to 53% in August,’ said Andy Knee, Chief Executive of LMS.’[1]

Knee believes that, ‘an increase in average rates for the first time in nine months, however small, is an indication that we may finally be starting to see the end of record low products and competition among lenders as rumours of an interest-rate rise persist.’ Continuing, Knee said that, ‘despite a sign that the mood might be starting to turn, annual wage growth and the growing gap between mortgage and remortgage payments mean the affordability of remortgaging is better than it has been for years.’[1]

‘Although the Bank of England Governor, Mark Carney, has consistently stated that when the base rate does rise it will occur slowly and gradually, even the smallest rise could see monthly payments increase enough to damage household budgets. Fixing now at a competitive rate would avoid an increase in outgoings that may otherwise be seen. A slight decrease in remortgaging activity from the levels seen at the start of summer is nothing to be concerned about and we anticipate maintained momentum throughout the rest of 2015 and into 2016,’ Knee concluded.[1]

[1] http://www.propertyreporter.co.uk/finance/gross-remortgage-lending-falls-17-in-august.html

 

 

Mortgage Lending Highest Since Financial Crash

Published On: September 16, 2015 at 11:50 am

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Mortgage Lending Highest Since Financial Crash

Mortgage Lending Highest Since Financial Crash

Mortgage lending for home purchases grew in July, according to lenders. Lending to first time buyers and home movers was the highest since the financial crash.

In total, 67,800 home purchase loans were advanced, up from 63,100 in June and from 64,700 in July last year.

It was the third consecutive month of growth by volume and value.

By value, lending to first time buyers rose by 7% annually and 5% on a monthly basis.

30,200 loans were granted, up from 29,400 in June and 28,900 in July 2014.

By volume and value, this was the highest level of lending to first timers since August 2007.

Furthermore, 37,700 mortgages were given to home movers in July, the highest level by volume since December 2009 and the highest by value since November 2007.

This data compares with 25,200 loans for buy-to-let, around half of which – 11,800 – were for property purchase and the rest for remortgage.

Remortgaging by homeowners dropped slightly, by 4.4% on the month, but up by a huge 34% annually, the highest of all loans.

The value of remortgages was £5.1 billion in July, higher than that for home purchase and first time buyers.

Remortgage Lending Almost Doubled Last Month

Published On: August 25, 2015 at 4:35 pm

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Categories: Landlord News

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The amount of remortgage loans hit 46,000 in July, 47% higher than the previous month and the highest number recorded since November 2008.

Conveyancer experts, LMS, calculates that the value of monthly gross remortgage lending rose by 41% to £7.2 billion in July and increased by 89% from July last year. This is the greatest growth seen since

Remortgage Lending Almost Doubled Last Month

Remortgage Lending Almost Doubled Last Month

October 2008 and is a huge boost to the industry after a slow start to the year.

The total amount of equity withdrawn from remortgaging in July was £1.27 billion, up 16% monthly and 183% annually, when equity was at £449m in July 2014. This is the largest amount withdrawn since April 2008, when £1.35 billion was withdrawn through remortgaging.

Improved affordability of remortgaging and the significant savings that borrowers can make due to record low rates have encouraged higher levels of activity, says LMS.

Chief Executive of LMS, Andy Knee, states: “Remortgaging has come back with a bite in July, following sluggish levels of activity throughout the latter part of 2014 and first months of 2015.

“We are confident these levels will be maintained with a steady stream of customers for the remainder of the year as record low affordability encourages borrowers to lock in competitive rates.

“Despite news that a base rate rise may be on the cards, lenders have not hiked rates and there are still many excellent deals to be had as lenders compete for business. But these will not last forever and borrowers should consider remortgaging now to avoid missing out.

“The current economic climate and rising average incomes mean households are typically less stretched than previously. Remortgaging has never been as affordable and can offer huge monthly savings as the gulf between new purchase and remortgage payments as a percentage of income grew, to 2.7%.

“A six-year high in the amount of equity withdrawn through remortgaging shows financially shrewd borrowers are keen to capitalise on these potential savings.”1 

1 http://www.financialreporter.co.uk/mortgages/remortgage-lending-hits-72bn-in-july.html?utm_content=bufferb70c4&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Housing Market is Picking Up

Published On: July 27, 2015 at 2:55 pm

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Housing Market is Picking Up

Housing Market is Picking Up

Mortgage lending by high street banks increased by 8% in June, compared with the same month last year.

Remortgaging loans were 20% higher and house purchase loans rose 6.2% in the same period.

Chief Economist at the British Bankers Association, Richard Woolhouse, comments: “The housing market is beginning to hot up again, as we’ve seen a pick-up in the number of mortgage approvals for the last month.”1 

He believes the increase in remortgaging is due to people moving to new fixed deals before interest rates rise.

In total, there were 75,636 loans in June, of which 44,488 were for house purchases, up from 41,864 in June 2014.

1 http://www.propertyindustryeye.com/housing-market-beginning-to-hot-up-say-lenders/

 

 

 

 

 

 

 

 

 

 

 

 

 

Remortgage Loans Reach Six-Year High

Published On: May 27, 2015 at 12:33 pm

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Remortgage Loans Reach Six-Year High

Remortgage Loans Reach Six-Year High

The total value of remortgage loans hit £4.8 billion last month, indicating that housing market activity may be returning to pre-crisis levels.

This is the highest number since 2009 and is a 15% rise on April 2014.

Conveyancing firm LMS has estimated that the amount of remortgage loans increased by 21% and the average loan has risen to £32,230 from £26,600.

Boss of LMS, Andy Knee, says: “The growth is a much-needed boost to a sector which has experienced huge fluctuations over the past 12 months.”1

1 Baird, R. (2015) ‘Remortgage loans ‘hit six-year high’’, Metro, 27 May, p.24