Ease of getting a mortgage is over

A recent report has suggested that the days when consumers could get a mortgage pretty easily are well and truly over, with more and more consumers having to plead their case, settle for whatever they can get, and even finding it impossible to get a mortgage that they can actually afford repayments on. With an increasing number of lenders cutting back on their lending, it has become increasingly difficult for borrowers to get the mortgage finance that they need.

Many lenders have now closed their doors to new lenders, using various tactics such as changing their lending criteria, hiking up their interest rates, and changing their deals in order to try and cut back on new business. Lenders are having difficulties in securing the finance that they need to fund their mortgages, and this has resulted in many having to rein in their lending because they simply do not have the funds to keep up with demand.

Many consumers have been priced out of homeownership, and those that are likely to suffer in particular are first time buyers and those with bad credit. The number of sub-prime loans on offer has plunged over recent months, and with lenders demanding higher deposits and offering far lower loan to value rations first time buyers with little in the way of savings are likely to experience immense difficulties when it comes to getting an affordable mortgage.

One mortgage broker commented on the situation, stating: “Conditions in the mainstream mortgage market are now rapidly deteriorating at a frightening speed, with lenders changing their pricing and/or criteria at the fastest pace in living memory, and probably ever.”

Recent additions:

•  More bad news for first time buyers
• Severe lending cutbacks from smaller building societies
• HIPs not useful unless changes are made
• Sharp increases in buy to let mortgage figures
• Advice for confused property purchasers

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