30 May: Almost 400 Products Pulled From Shelves
Hundreds of mortgage deals have been pulled by lenders over the past week, according to data from Moneyfacts, writes Mark Hooson.
Borrowers have fewer residential and buy-to-let mortgages to choose from since 22 May, with the number of available mortgage deals falling from 5,385 deals to 5,012.
In the residential market, Aldermore, Foundation Home Loans and Tipton & Coseley Building Society have pulled their entire fixed rate ranges. Bank of Ireland UK, Bath Building Society, Furness Building Society and more have pulled selected fixes.
In the buy-to-let sector, Aldermore, Bank of Ireland UK, CHL Mortgages, Fleet Mortgages, Foundation Home Loans and The Mortgage Lender have pulled their entire fixed-rate ranges.
Meanwhile, Precise Mortgages, Kensington, Kent Reliance, Hodge and Marsden Building Society have each withdrawn select deals.
These borrowers join the likes of Nationwide and Virgin Money who announced changes to their mortgage products last week (see story below).
While choice has shrunk, average interest rates have grown. The average rate for a two-year fixed rate residential mortgage is now 5.38%, while a five-year fix has an average rate of 5.05%.
It’s believed lenders are reassessing their product offerings in response to uncertainty over future interest rate hikes as inflation remains high.
Though the headline rate of inflation, the Consumer Price Index (CPI) fell from 10.1% to 8.7% in April, other measures of inflation are higher. Food inflation, for example, was 15.4% in May, according to the British Retail Consortium.
Such figures have led to speculation that the Bank of England may be forced to hold or further increase its main rate next month – directly affecting mortgage lenders and the rates they charge to borrowers.
The Bank rate currently stands at 4.5% and there is speculation it could rise to 4.75% when the new figure is announced on 22 June.
25 May: Bank Of England Expected To Push Up Rates In June
Mortgage borrowers are being warned to brace for higher costs if they need to take out a loan or remortgage in the coming months as fixed rates look set to rise further, writes Jo Thornhill.
Nationwide is increasing its mortgage rates following the spike in institutional lending rates in the past two days. The building society will increase fixed rates by up to 0.45 percentage points for new borrowers, including first-time buyers, and on deals for existing customers looking to transfer.
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Source: www.forbes.com
ENB
Sandstone Group
