Less homes repossessed but what will happen when the interest rates rise

Posted by Amy Flower in Mortgages on 18 August 2015 - Amy is a Senior Credit Analyst at checkmyfile

New data out reveals that the number of properties repossessed have dropped for the second quarter of the year, as less homeowners fall behind on mortgage payments. The amount of repossessions has declined from 2,500 in the first quarter, with an additional 3,000 in the second quarter. Compared to the same quarter last year, the decline is 5,400, indicating that the low interest rates were keeping the numbers down.

Council of Mortgage Lenders Paul Smee comments, "This trend is very welcome. Low interest rates are acting as a significant support for homeowners in general, and are likely to be helping to stave off low level arrears for stretched households in particular".

CML figures indicate that there are less homeowners falling into arrears and the number of repossessions lowered to 1,800 for owners and 700 for buy-to-let landlords.

Advice is being given to homeowners to be aware of what impact an interest rate rise would mean and if they can afford one. Mark Carney, Governor the Bank of England, has kept the base rate at a record low 0.5% since 2009, with a potential rise beginning from the end of 2015. The planned rise is reported to be made incrementally from 2015 to 2018 at an estimated 0.5% per annum, reaching 5% by 2018.

Homeowners and landlords with high loan-to-value percentage need to be prepared for the increase and the impact this will have on their repayments. Families need to budget for the increase and look at how they can make savings or cut backs to put the extra money towards the increased payments. Landlords also need to crunch their sums to see if and when the percentage rise will have a knock on impact on the rent they are charging and if they also need to increase it. An impact will also be felt by first time buyers, who may also experience more difficulty gaining their mortgage and affording what they need to borrow.

Applying for a Mortgage? Check Your Credit Report

Don’t Get Turned Down, Check it Today

Last minute mortgage checks

When could a non-bankrupt person be considered bankrupt? When they’re buying a house.

Published on 17 Jan 2018 by Richard Catlin

Full Article

Guarantor loans can affect mortgage applications, lenders warn

Guarantor lenders are always keen to point out that you don’t need a credit report check to get their loan, just a friend or family member who has a good credit history and is able to act as a guarantor. For those with a poor credit rating, this type of loan provides a solution to a problem – they can afford the loan repayments but are unable to get credit due to prior adverse credit history.

Published on 9 Jan 2018 by Kelly Luff

Full Article

How your credit file could help you get a good mortgage deal

There have been plenty of reasons to get people thinking about making that first leap onto the property ladder in recent months, including Help to Buy schemes, the recent removal of stamp duty charges for about 95% of first time buyers and an increase in affordable houses being built.

Published on 29 Dec 2017 by Kiah Phillips

Full Article

The best credit score for a mortgage

A lot of customers come to checkmyfile because they are planning on applying for a mortgage – your credit report is, after all, the best place to start is it’s helpful on more than one occasion . But often the question is often asked: “what credit score will get me the mortgage I need for my dream home?”

Published on 16 Feb 2017 by Kelly Luff

Full Article

Homeownership among 25 year olds halved in 20 years

Homeownership among 25 year olds has more than halved in the last 20 years, according to a survey conducted for the Local Government Association (LGA). The study carried out by Savilles the estate agents found that only 20% of 25 year olds now own a home of their own, compared to 46% in 1996.

Published on 5 Jan 2017 by Erika Bone

Full Article

Housing Values Rise to 5.6 trillion

While housing prices have displayed a consistent rise over the past several years, according to a recent study conducted by Halifax, the total value of privately owned housing in the UK has exceeded £5.5 trillion for the first time.

Published on 14 Dec 2016 by Tom Magor

Full Article

First-time lenders can borrow against parent's home

In recent decades, the “bank of mum and dad” has increasingly become a cardinal resource for their offspring achieving independence and for first-time buyers attaining a foot on that all-important first rung of the property ladder.

Published on 9 Dec 2016 by Erika Bone

Full Article

Buy to let slows as mortgage rate offers begin to increase

In the last few years we have not only seen some historically low mortgage rates, but also a rush to make property investments. Now the tide may finally be turning, as lenders begin to increase their lowest mortgage rates, and buy-to-let figures drop in the wake of new regulations.

Published on 7 Dec 2016 by Kelly Luff

Full Article

Mortgage costs reach record low

The cost of obtaining a mortgage could be in reach for first-time buyers, as rates drop to a record low.

Published on 16 Nov 2016 by Simon Hadley

Full Article

Surge in House prices recorded in October

House Prices shot up in October, showing a monthly increase of 1.4%. This is according to Halifax’s house price index, which showed its largest monthly rise since March. The growth was well up on the 0.3% recorded by Halifax in September and is in contrast to the signs of a slowing housing market recorded in its index over the last 6 months.

Published on 10 Nov 2016 by Neil Greenhill

Full Article
keyboard_arrow_left

keyboard_arrow_right

We have loads of great customer reviews