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Friday 17 April, 2020

Thomas Wheatley, Mortgage Broker in Tottenham, North London reviews how the mortgage lenders, surveyors and estate agents are adapting to the new mortgage situation following the coronavirus outbreak.

If you require mortgage advice, please call our mortgage broking team on 01707 872000. We can organise a mortgage for you now or ensure you are fully prepared to go ahead when lockdown ends.

Since the outbreak of COVID-19 there has been many changes to the mortgage market in order to combat the outbreak and assist borrowers. 

Mortgage Payment Holidays

As many people are aware the government has introduced mortgage payment holidays. Although, these had previously been available they had been at the discretion of the mortgage lender, whereas the government introduced rules to ensure that everyone was eligible for a mortgage payment holiday. 

Clients can still do a product transfer while they are on a mortgage payment holiday

What has happened recently though is very important. When mortgage payment holidays were introduced it was unclear whether clients would still be able to do a product transfer whilst they were on a payment holiday. This was a major concern as many of the public have been furloughed or laid off so they would not be eligible to move to a new lender. But the good news is that mortgage lenders are starting to confirm that clients will still be eligible to do a product transfer whilst they are on a payment holiday. Not all mortgage lenders have announced this, but Halifax, TSB, Barclays and Nationwide have already announced that they will allow it, so we are hopeful that other mortgage lenders will follow. This is extremely important as apparently 1 in 9 mortgage customers have had to make use of the mortgage payment holiday.

Can automated surveys be used during lockdown?

Due to the lockdown there has been an issue getting up to date valuations as surveyors are not able to go to visit a property. Although automated surveys were already in use, they have had to be used more often now in order to keep purchases and sales progressing. For example, HSBC are able to do automated valuations, up to 90% of the loan to value on a purchase, whereas before the outbreak this was a lower percentage, and many lenders mainly used automated valuations just for re-mortgages. Showing that lenders are adjusting and trying to be as helpful as possible is very encouraging. Also, I have noticed that surveyors are now asking clients to email them photos of areas that they are unable to see before to help them provide a more accurate valuation. Estate agents are also trying to work differently, and they are offering virtual viewings in order to try and maintain a level of business activity and fluidity in the market.

Many lenders are re-introducing products with higher loan to values

At the start of the outbreak many lenders reduced the number of products they offered, especially those with a higher loan to value ratio. This made sense as they needed to restrict the amount of applications they received whilst trying to come up with a strategy of how to manage the coronavirus situation. The good news is that many lenders have now reintroduced many of their products and are happy to lend again, showing the market is adapting and trying to remain as open as possible.

Thomas Wheatley, Mortgage Broker & Protection Adviser in our North London mortgage broking team said:

‘Obviously, there are still issues as not every property will be suitable for an automated valuation and there are delays to timescales due to reduced staff levels. However, what is really important is that in the last few weeks we have seen mortgage lenders, estate agents and surveyors all trying to overcome problems caused by the coronavirus outbreak. This is very positive news and gives us hope that the housing market can move forward. We recommend that if you want to move home after lockdown or are considering purchasing a home in the next six months that you call a mortgage broker in our Thomas Oliver mortgage broking team. We can discuss your individual financial situation and provide tips on what to do to prepare for your house move, even if we are still in lockdown.’

Mortgage Market – in Summary…

The mortgage lenders are adapting to the new situation and the mortgage market is still open. If you are a first-time buyer, a buy to let investor, wanting to move home, or re-mortgage please contact our mortgage broking team now on 01707 872000 for mortgage advice.

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