Finance Matters

• 17Oct

  Nationwide promotes 95% mortgages

  Mortgages No Comments

  From This is Money:

  Nationwide Building Society has hit the headlines after promoting its 95% mortgages for existing borrowers looking to remortgage or move home.
  These deals are not new and the building society has offered mortgages to those with small deposits for some time, however, it has promoted them in its latest round of mortgage deals.
  The mortgages for those with just a 5% deposit are only for existing Nationwide borrowers, either moving home or remortgaging, and are available as tracker of fixed rates.

  Moving home at 95%
  For those moving home the fixed rates at 95% are very expensive: a two-year fixed rate deal starts at 6.48% with a fee of £896 and rises to 6.88% with no fee. A five-year fixed rate costs an eye-watering 7.43% with an £896 fee.
  The trackers offer a better initial rate at 95% but will become expensive when interest rates rise. A two-year tracker starts at 5.33% with an £896 fee: tracking a full 4.83% above base rate this would hit 6.83% if the base r…

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• 17Oct

  Can a viewing day help sell your home?

  Mortgages No Comments

  From This is Money:

  Now meet ‘open towns’? last Saturday, Strutt & Parker’s 33 offices persuaded all but a handful of properties on their books to do an ‘open house’ on the same day.

  The initiative comes on the back of the resounding success of a regional pilot in March.

  ‘It staggered us how many people went to see the properties.’

  ‘If they know others are going and the owners are ready for it, they are much more inclined to do it, too,’ says Major.

  ‘We had two months of viewings in one day. One of the houses had 21 viewings. We were almost knocked over by the rush,’ says Major.

  ‘We had one house that had been on the market for nine months ? we had three viewings on the open day and one bought.’

  And it galvanises into action those who’ve expressed a prior interest and know that the day will attract many more potential buyers. It doesn’t necessarily push up the price, but it prompts people to make a deal.

  Strutt & Parker advertised locally and nationally for two month…

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• 17Oct

  Should we worry about capital gains tax?

  Mortgages No Comments

  From This is Money:

  We have heard that if he changes the mortgages to take account of the rental we wouldn’t be liable for capital gains tax as he lived in the house for nine years. Is this correct? K.T., Preston, Lancashire

  Based on the information supplied, the property seems to qualify as your boyfriend’s principle private residence and after he vacates the property he will still be able to claim relief for a period of 36 months, even if the property is let.

  He would, therefore, be strongly advised to obtain a professional valuation of the property from a chartered surveyor at the date he vacates, as this information could be useful later in any queries over potential tax liability. The fact that the property may be held on a different mortgage does not alter the capital gains tax position, but he must notify his mortgage lender if he vacates the property and installs a tenant, otherwise he is in breach of the terms of the loan….

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• 17Oct

  Rics: Property back to boom-days peak

  Mortgages No Comments

  From This is Money:

  Twenty-two per cent more agents saw rises than falls in September, the highest ‘positive reading’ since May 2007 and compares with a figure of 10% in August.
  The evidence suggests the price revival is being driven by an acute shortage of properties, particularly family homes.
  There is also clear evidence of a North-South divide, with prices in London and the South-East showing a surge while many parts of the North are still suffering falls.
  Ian Perry, a spokesman for the institution, said: ‘A lack of supply is still underpinning the rise in house prices. Meanwhile, the level of inquiries from potential purchasers is increasing.
  ‘This imbalance between demand and supply suggests that house prices will move higher in the near term.’

  The Rics report is regarded as a reliable early indicator of market trends, having given warning ahead of the property crash of the early Nineties. It also signalled price falls in the summer of 2007 while other major surveys only registered dec…

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• 17Oct

  Landlords predict price and rent recovery

  Mortgages No Comments

  From This is Money:

  After enduring two years of falling house prices and a year or more of falling rents, landlords are now looking to property values rising and rents possibly increasing.
  The latest quarterly survey of landlords by Paragon Mortgages shows that on average, they expect a 0.8% increase in the value of their portfolios over the coming year as the property market mounts a sustained recovery.
  While this is only a small increase, it marks the first positive response since the first quarter of 2007 and follows the spate of recent house price reports suggesting house price are rising.
  And according to property website FindaProperty.com, an early autumn surge in rental demand has also boosted buy-to-let. There were 6.2% more properties rented out in September, with a particular run of activity from students and young workers.
  FindaProperty’s monthly report said that rents were steady at £829 in September, highlighting the market stabilisation that began in the spring. They have inched…

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• 17Oct

  Wilsons sell buy-to-let empire for £180m

  Mortgages No Comments

  From This is Money:

  Now they are selling up with an asking price of £180m for their property empire that is claimed to only hold £45m worth of debt against it.
  Foreign investors are rumoured to be interested in the portfolio, but property experts suggest they will want a discount to market value and question whether the Wilsons will reach their target.
  Laura Powell meets the Kent property magnates who are confident that now is the best time to sell and finds out how they made their fortune.

  This certainly doesn’t look like the stately pile of a billionaire. There’s no gold jacuzzi, no personal tanning salon (like Simon Cowell), no £16m private jet (like Sir Philip Green), not even a Rolls-Royce (like Del Boy)….

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• 24Sep

  First-time buyers ‘penalised’ by lenders

  Mortgages No Comments

  From This is Money:

  Figures from Moneyfacts.co.uk show that average two-year fixed mortgage rates for those only able to put down a 10% deposit currently sit at 6.12%.

  This is a whole 4.25% above two-year swap rates, the rate at which lenders borrow fixed rate funding between themselves.
  Cuts have seen the Bank of England base rate fall from 5% to 0.5% in the last twelve months, but had almost no impact on mortgages costs for those with limited funds.
  Rates remain stubbornly high for loans taken on a small deposit, while those who can raise 25% or 40% are seeing bargain basement deals.
  Steve Smith, senior consultant at mortgage broker Chartwell Funding said: ‘First-time buyers are being penalised for the mistakes made by the banks.’
  ‘They didn’t get us into this mess, but now they’re the ones paying because banks are unwilling to take risks on loans worth more than 75% of the property.’
  ‘Instead, what’s happening is that lenders are simply making more money out of those with limited funds by…

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• 24Sep

  Farewell to the 0% tracker mortgage

  Mortgages No Comments

  From This is Money:

  Two years ago Halifax was selling a two-year tracker at base rate minus 0.51%. Since April the estimated 7,500 borrowers who took it have been paying no interest.
  But that deal comes to an end on September 30 – closely followed by an identical version ending on November 30.
  Borrowers coming off these deals will suddenly find themselves paying the Halifax’s standard variable rate of 3.5%.
  This will push monthly repayments up from £544 to £792 for a borrower with a £150,000 home loan.
  Halifax is offering these customers a two-year 0.51 point discount off its standard variable rate. This would leave them paying 2.99%, with repayments of £752. But there’s a £599 fee and early redemption penalties.
  There are three remaining 0% tracker mortgage deals. Two come to an end in December. One was offered by C&G and the other to buy-to-let purchasers by BM Solutions.
  C&G borrowers will go on to a 2.5% rate and BM 2.54%. The third, also from C&am…

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• 24Sep

  BBA: Mortgages beginning to flow again

  Mortgages No Comments

  From This is Money:

  The British Bankers’ Association, which represents the major High Street lenders, said that net lending from its members jumped to £2.8bn in August from £1.9bn in July.
  The figure was slightly above the recent six-month average of £2.7bn and 17% higher than in August last year, as demand continued to be boosted by the recovery in the housing market.
  The BBA also released figures on the number of loans issued by banks. Here the improvement on last year was even more marked, with the 38,095 loans issued in August some 81% more than August 2008, and more than double the low of 18,330 reached in November 2008.
  However, the total loans issued in August this year were marginally down on the previous month, reflecting the end of the Summer rush in the property market.
  The number of people remortgaging remained subdued at just 26,124, while those releasing equity from their property or taking out a buy-to-let loan hit a new record low of 17,918.
  David Dooks, BBA statistic…

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• 24Sep

  Is this finder’s fee fair?

  Mortgages No Comments

  From This is Money:

  It transpires that a couple have put down the deposit with a view to moving in. Do we still have to pay the outstanding rent for the remaining two months? Also, is it not right that only the landlord pays a finder’s fee to the agent? L.V., Hastings East Sussex
  It is standard that you would need to pay the rent in full to the end of your term if an alternative tenant cannot be found. However, if a tenant is found who can move in and pick up the rental payments as soon as you leave then there should not be an issue. Regarding the finder’s fee, this is not a standard condition so you do need to check the original agreement you signed when moving in and if it is included then I’m afraid you will have a legal obligation to pay it. If, however, it is not included in your original contract then I would certainly challenge the right of the estate agent to make you pay that fee….

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