Kevin Dunks, Founder of Number One Mortgages and adviser, gives his prediction of mortgage rate trends in 2015
It seems unbelievable, but many people-in-the-know are predicting that mortgages in 2015 may be EVEN MORE competitive than last year!
It seems unbelievable, but many people-in-the-know are predicting that mortgages in 2015 may be EVEN MORE competitive than last year!
In fact, I think we’re in the middle of a mortgage rate war with rates set to become even more competitive as lenders battle for business.
Mortgage lenders are still dropping rates – I’ve seen a rate of 2.49% on a 5 (five) year fixed which is pretty amazing! (Best rates are often reserved for people with high deposits of 30% plus, there may be fees attached to the best rates).
I think this is the result of a few major factors:
• We’re seeing low inflation,
• We’re seeing no imminent rise in interest rates and
• I think lenders have some catching up to do on their targets……
Last year the MMR (Mortgage Market Review) was introduced which meant more detailed checks on mortgage applications. I think this has made lenders hungry for new business.
As a buy to let investor you potentially have more power to haggle over the property price. Not being reliant on selling another property to purchase your investment means you’re not forming part of a chain. You can make stronger offers on this basis.
Double your chances of significant ROI (Return on Investment). If you find a property that needs work before you can place it up for rent there’s scope to make money on the rental income and the resale of the property. While your initial costs will be higher to purchase materials and labour to improve the property, you can start seeing a greater return on your investment with the rental income almost immediately, but also the overall property value will rise. Be aware that the property does need to be deemed as rentable in its current condition by the lenders surveyor.
All in all, it looks like the New Year is about to go off with a bang! I’ll be watching with interest……..
If you’re looking to move home, buy for the first time or remortgage, make sure you’re getting the best deal for your circumstance by contacting Number One Mortgages on 01273 736536