As the mortgage crisis continues, HeatherL_Star and MattPanterMedia take a look at how to navigate the housing world.
The average five-year fixed-rate homeowner mortgage has jumped above six per centThe average five-year fixed-rate homeowner mortgage has jumped above six per cent, new data from website Moneyfacts has shown.
“This will of course be a concern for those looking to buy a new property or refinance their existing mortgage, but my first piece of advice is not to panic. “A lot of lenders offer six-month mortgage offers now on remortgages, when it it used to be traditionally three months. We are saying to clients, act now, rather than later and use that six months to secure something today.”Estate agent Russell Griffin, director of Samuel Wood Estate Agents in Shropshire, said there is no such thing as waiting for the ‘right time’ when it comes to property.
“This obviously has some repercussions regarding chains and if you’ve ever experienced a house sale fall through, you know how devastating that could be. Shropshire and Telford & Wrekin are very desirable areas in which to live or move to, and we are seeing a steady flow of out-of-areas still coming through.
“Overpaying while your rate is low could also mean you can reduce your loan to value , which may help you unlock lower interest rates when you remortgage.“At the very least by paying a little extra off on your mortgage while you can afford it could help you budget now for higher rates in the future and chip away at some of what you owe.
“It’s also worth bearing in mind that overpaying on your mortgage probably won’t reduce the amount you pay right now. Speak to your lender to see what is available and what suits you best. Following the Bank of England’s recent decision to raise interest rates, Ben Beadle, chief executive of the National Residential Landlords Association, explained that 85 per cent of buy-to-let mortgages are interest only, making them especially hard hit by rising mortgage costs. He said some landlords had seen mortgage payments rise by almost 240 per cent since December 2021.
His first tip is to try to negotiate. “Negotiating is not as easy as it used to be as rental demand has increased. This means that if you want to make an offer on a flat, you’ll have to be smart about it. Think about what could make you stand out compared to other tenants,” explains Olly. If they have become unaffordable, MoneyHelper, the government’s advice service, says the first step should be to contact your lender to talk through your options. The lender must make reasonable attempts to reach an agreement with you, including considering whether to change the way you make payments and when you make them.
It suggests asking your landlord if you can pay slightly less than they’re suggesting. For example, if your landlord wants to increase the rent from £750 per month to £800 per month, suggest meeting in the middle and paying £775. Your landlord might negotiate on price rather than risk losing you as a tenant.
If you decide to move out, make sure you’ve found a new place to live before you leave. If you need guidance, the Citizens Advice helpline can be contacted on 0800 144 8848 or you can contact your nearest branch.Propertymark, a membership organisation for property agents, says landlords should first get in touch with their tenant, if they notice that the rent has not been paid.
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