Borrowers shouldnt wait before considering a fixed rate option

Average rates across two- and five-year fixed products have crept up, and borrowers on their lender’s Standard Variable Rate should be wary of future rises and look to fix sooner rather than later.

The warning comes after a number of lenders announced hikes to their SVR (Standard Variable Rate) rates which come into force on May 1.

Analysis has found that the average rate for two-year fixes hit a low last October, falling to 3.82%, but has now risen to 4.15%.

This means a difference of £27.31 per month or £327.72 over the year for repayments based on a £150,000 mortgage.

Similarly, five-year fixed rates hit a low in January this year with an average rate of 4.57% but this has crept up to 4.72%, adding an extra £12.81 per month or £153.72 over the course of a year.

For two-year trackers, the average rate was at its lowest in August 2011 at 3.37% but now stands at 3.63%, hitting consumers with an extra £20.91 per month payment or £250.92 over the year.

The number of SVR rises announced by lenders recently , come into effect in May.

About one million customers will be affected by these increases announced by providers including Halifax, Co-operative Bank, Bank of Ireland and RBS/NatWest.

Overall, the average increase to SVRs is 0.62% which will add an extra £52.58 to a £150,000 mortgage or £630.96 over the year.

Mortgage rates are nudging upwards, there is no doubt about that so anyone looking for a mortgage or whose mortgage deal will end in the next few months should act sooner rather than later to secure one of the current rates in case they rise further.

Any borrowers paying their lender’s SVR should also reassess their mortgage arrangements. One of the consequences of the low base rate has been the fact that SVRs have been similar to the rates on new mortgage deals and in some cases the SVR has been even lower.

Consequently as a result, an increasing number of people have opted to stick with their existing lender and move on to the SVR when their fixed or introductory tracker or discounted period ended, as opposed to remortgaging elsewhere.

However, as around one million borrowers are about to find out, many SVRs can rise even if base rate doesn’t.

Estate agent under fire for 'strong arm' mortgage tactics - Introducer Today

Estate agent under fire for 'strong arm' mortgage tactics - Introducer Today

Out of the mouths of babes - has an 11 year old solved Europe's debt crisis?

An 11-year-old boy has been highly commended for his imaginative entry to a competition to find a credible plan for a euro exit.

Jurre Hermans was among 452 candidates who submitted entries to win the £250,000 Wolfson Economics Prize.

Although his idea was not among the five shortlisted, Jurre received special mention from the judging panel and will receive an €100 gift voucher, the Telegraph reported.

Jurre's plan suggests the Greek people could exchange their euros for new drachma at the bank, which the Greek government would then redistribute to creditors so they could get "a slice of the pizza".

"The Bank gives all these euro's to the Greek Government. All these euros together form a pancake or a pizza. Now the Greek government can start to pay back all their debts, everyone who has a debt gets a slice of the pizza.

"You see that all these euro's in the pizza's go the companies and banks who have given loans in greece," Jurre's entry stated.

Jurre's plan also addressed a potential capital flight from Greece: "The Greek people do not want to exchange their Euros for Drachmes because they know that this Drachme will lose its value dramatically," he said.

"They try to keep or hide their euro's. They know that if they wait a while they will get more Drachmes.

"So if a Greek man tries to keep his Euros (or bring his euros to a bank in an other country like Holland or Germany) and it is discovered, he gets a penalty just as high or double as the whole amount in euros he tried to hide!!! In this way I ensure that all Greeks bring their euros to a greek bank and so the greek government can pay back all the debts."

Once interest only , always interest only ?

Borrowers on standard variable rate interest-only mortgages need to think about remortgaging fast as nine lenders have now cut their maximum loan to value.

Anyone with an interest only mortgage that is currently on a lenders’ own variable rate (Standard Variable Rate) needs to think very seriously about protecting their position following the recent sudden surge in lenders reducing the Loan to Value on interest-only mortgages to just 50%.

Staying as they are is effectively making themselves ‘un-mortgagable’.

Lenders cite this as “prudent” borrowing but anyone who currently has an interest-only mortgage at a higher LTV than 50% needs to consider their limited options quickly.

The latest changes to interest-only mortgages have seen Abbey, Leeds and Coventry cut LTVs from 75% to 50%, Nationwide cut from 66% to 50%, Newbury cut from 75% to 70%, Skipton from 75% to 60%, Manchester cut from 70% to 60%, Teachers Building Society cut from 70% to 50% and HSBC cut from 80% to 75%.

Problems may well arise if there is a need to borrow additional money for home improvements, such as building extra bedrooms etc because this will be deemed a new loan.

Clients in this situation will only be able to borrow around 50% of the house value, which in most cases will be less than the original mortgage.

The end result is that many people who chose an interest-only mortgage because it was cheaper and are at their maximum monthly outgoings will find themselves unable to move should they need to - they are in fact under a form of house arrest.

40% of estate agents think that a third of their properties are over priced

An astonishing poll of estate agents claims that 40% believe that property on their books is over-priced.

The claim has emerged in a poll of over 200 agents conducted by review site MeetMyAgent.

The poll was conducted between March 20 and 24 and claims to show that 38% of agents believe that more than 30% of their stock is over-priced.

 Almost all the agents quizzed – 93% – say that at least one tenth of the property on their books would benefit from a price reduction, and almost three-quarters (72%) of agents say that the main reason for sellers not lowering their prices is that they are happy to wait for the offer they want.

Three-quarters of agents are seeing more viewings than this time a year ago. However, pricing is a real sticking point, with 43% of agents saying that the gulf between what buyers will pay and what sellers will accept is the main reason for sales not being secured.

Low stock levels are a concern for 85% of agents, with the poll showing that 35% say their stock levels are 30% down on normal levels for this time of year.

Ashley Alexander, director of MeetMyAgent, said: “Although, encouragingly, there are plenty of buyers viewing properties, very few are actually committing to a purchase.

“The economic climate is doubtless playing a role in this, but so too is the fact that buyers still feel sellers are asking too much for their properties.