AToM Mortgage Blog

It may have slipped your mind, but we’re only a couple of months away from…the stamp duty threshold increase! Oh and Christmas! This means that if you are looking to purchase a property priced between £125k & £175k, unless you complete the purchase before the end of the year, you could be paying out a further £1,250 to £1,750 in stamp duty costs. This is of course unless the property is in a ‘disadvantaged area’ in which case the Stamp Duty threshold decreases to £150k, rather than £125k. The clarification on a ‘disadvantaged area’ on the HM Revenue and Customs website is ‘residential, mixed use residential element’. Good, glad that clears that up then!
The Self Certification (no proof of income) market seems to have its days numbered as The Mortgage Works (specialist arm of the Nationwide) withdrew all its Self Cert products last week. This only leaves a few Lenders remaining in this arena and they will not want an increase in business from this sector. With speculation rising in the market that the FSA are looking to remove Self Cert altogether, Lenders will be currently reviewing the risks and their exposure in this category and I suspect more will withdraw in due course. It’s a shame as Self Cert is ideal for many customers with self employed income and, especially in the current climates, where people have two or more jobs with income not readily provable. On top of this, the removal of such a category could also trap existing borrowers into their current mortgage.
Finally, the Bank of England base rate is set to remain below 2% until 2014, according to the Centre for Economics and Business Research. The CEBR is predicting that interest rates will stay at 0.5% until at least 2011. If correct, this is great news for those on tracker rates. In fact, a few lenders have launched products for customers to start on a tracker rate and, if the Bank base rate was to increase, allows a switch to a fixed rate (for a minimal fee!) at any time during the tracker period (conditions apply!). Good to see some Lenders assisting with innovative products!

Labels: all types of mortgages, first time buyers, mortgages, self cert