Remortgagers can’t be bothered with the hassle
The number of remortgage loans taken out in August 2014 has declined by 1 per cent compared to the previous month and by 8 per cent year-on-year, according to estimations by the Council of Mortgage Lenders.
As a result monthly gross remortgage lending also dipped by a per cent in August to £3.87bn with experts citing the Mortgage Market Review (MMR) as a primary factor.
MMR focuses on the borrower’s affordability with lenders applying stringent tests to ensure they can not only afford the mortgage payments now but also in the future should rates rise.
Nevertheless Lynne McCaffrey is confident this hangover will eventually subside:
“At the minute we’re all finding our feet with the new MMR processes and procedures. Because of this applications are taking significantly longer with lenders conducting what would appear intrusive checks into a borrower’s finances.
“However as with most things in life practice makes perfect and once the new way becomes ‘the norm’ I expect things will settle down. Lenders will start to develop an appetite again for new business and, in turn, entice borrowers with attractive new rates.
“We’ll also see the market naturally increase as rising house prices begin to pull many mortgage prisoners out of negative equity.”
Content correct at time of publication