Catch up on Mortgage Strategy’s most popular stories this week. West One Loans launches five-year fixed rate mortgage products and Mortgage arrears jump by almost a quarter in Q3. Read more below:
West One Loans launches five-year fixed rate mortgage products
West One Loans has introduced a limited edition of five-year fixed-rate mortgage products designed for a range of borrowers, including first-time buyers and those looking to remortgage. The specialized lender’s Prime Plus five-year fixed-rate mortgage begins at 6.29% for up to 75% loan-to-value (LTV) and includes the potential for rate reductions of up to 60 basis points.
Scottish Widows pulls out of resi, remo markets to focus on later life lending
Scottish Widows Bank, a subsidiary of the Lloyds Banking Group, will exit the house purchase and remortgage markets and shift its focus to equity release loans starting later this month. As of November 17, the lender will cease accepting new customer applications for purchase or remortgage transactions.
Barclays cuts resi rates by up to 26bps, HSBC reduces home and BTL offers
Barclays has reduced rates in specific home purchase and reward ranges, with reductions of up to 26 basis points. Additionally, HSBC is set to adjust pricing for residential and landlord deals. Notable changes to Barclays’ residential purchase products are scheduled to be introduced on November 1.
Mortgage arrears jump by almost a quarter in Q3: Pepper Advantage
Mortgage arrears surged by nearly 25% during the third quarter, reaching a post-financial crisis peak, according to data from Pepper Advantage. The global credit intelligence company analyzed data from its portfolio of over 100,000 UK mortgages, revealing that residential home loans in arrears rose to 23.3% in the third quarter compared to the previous year. This marks the highest rate seen since the global financial crisis of 2007/2008.
LV= partners with Scottish Widows to launch two later life products
LV= is set to introduce two equity release products through a fresh funding collaboration with Scottish Widows. These products, namely LV= Lump Sum Lifestyle and Drawdown Lifestyle, are scheduled to be available in the market on November 7. These offerings are designed to provide enhanced flexibility for customers seeking to utilize equity release as a means of accessing capital to bolster their financial strategies.
Bank of England holds base rate: Industry reaction
Property professionals found solace as the Bank of England decided to maintain the base rate at 5.25%, marking a 15-year high. This decision allowed them to assess the impact of the recent series of rate hikes on households. The Bank of England’s Monetary Policy Committee voted 6 to 3 in favour of retaining rates at their September level, following 14 rate increases from the historic low of 0.1% in December 2021.
HMRC figures show transactions falling 19% year on year
According to the latest data from HMRC, the preliminary non-seasonally adjusted figure for the number of residential transactions in the UK in September 2023 stands at 92,600. This reflects a 19% decline compared to September 2022 and a 2% decrease compared to August 2023. Mark Harris, the CEO of SPF Private Clients, remarks, “Transaction volumes have once again declined due to the impact of elevated interest rates and rising living costs. Borrowers are reevaluating their affordability limits.”
Consumer Duty targets second charge mortgages and marketing: FCA
The Financial Conduct Authority (FCA) is intensifying its scrutiny of fair value in the second charge mortgage market and firms’ customer marketing practices as part of its ongoing Consumer Duty reforms. These guidelines, applicable for the last three months, encompass about 60,000 regulated financial firms in the UK, including approximately 100 lenders and 18,000 mortgage brokers and firms.
Mortgage approvals slide in September: BoE
In September, net mortgage approvals for house purchases dropped to 43,300, marking the lowest point since January 2023. Additionally, net approvals for remortgaging declined to 20,600 in September, hitting the lowest level since January 1999.
First-time buyer economy worth £74bn by 2025, study finds
A new study, conducted by Coventry for intermediaries in collaboration with the Centre for Economics and Business Research (Cebr), reveals that the first-time buyer (FTB) economy is projected to grow to a total of £74.1 billion by 2025. This research examines the contribution of FTBs to both the housing market and the broader UK economy.
