03 Jul 2014

Further dip in mortgage approvals

Further dip in mortgage approvals

Donna Brown, Financial Services Operations Manager, reports on the news that there is a further dip in mortgage approvals.

Donna Brown, Financial Services Operations Manager, reports on the news that there is a further dip in mortgage approvals.

It cannot be denied that mortgage approvals within the UK dipped again in May and are now less buoyant than the Bank of England’s expectations at the beginning of the year. The Mortgage Market Review is obviously the main factor for this dip and at Aberdein Considine we are finding that on average it is taking longer to get mortgage offers today compared to pre MMR.

This is partly due to some lenders struggling to process applications because of the volumes they are receiving and partly because some lenders are asking more questions after receiving an application.

Halifax/Lloyds and RBS/NatWest have announced a restriction of 4x a persons income in the maximum they will lend where the mortgage amount is over £500,000 and Halifax and Nationwide have restricted Help to Buy 1 mortgages to FTBs. 

If lenders announce their own mortgage restrictions, whether or not there has been any political pressure to do so, there is less reason for the Financial Policy Committee to recommend to The Chancellor mandatory restrictions to slowdown a potential property bubble.

By the time of the September Financial Policy Committee meeting, the impact of the Mortgage Market Review will be much clearer, and the house price indices may be reflecting the slowdown. By then it will be much easier to make a sensible judgement on whether any action is required.

Donna Brown, Financial Services Operations Manager

Authorised and Regulated by The Law Society of Scotland. Authorised by Financial Conduct Authority.Your home may be repossessed if you do not keep up repayments on your mortgage.

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