by Sam Fox www.warringtonmortgagecentre.co.uk
VIDEO: WHY is the UK housing market in meltdown?! We’re pretty fed up with the news too… but it’s not as bad as it seems.
Stamp Duty Cuts, a new Prime Minister, Tax Changes, Energy pricing on the up, Interest Rates increasing, Banks withdrawing products, house prices increasing…
The list is endless.
We’re all feeling the exact same, and this past week has thrown even more UK homeowners into turmoil. But look, it’s not as bad as it seems.
What we’ve learned the past week:
• The Bank of England Base rate has risen to 2.25% – the highest since 2008
• Stamp Duty Land tax has removed for Home Movers – up to a £250,000 purchase
• Stamp Duty Land tax has removed for First Time Buyers – up to a £425,000 purchase
• Lenders are withdrawing mortgage products available on the market
• Basic rate of income tax from 20% to 19%
The Bank Of England has increased base rates, so what that mean and how does it affect you?
Put simply, the base rate is the rate the Bank of England charges other banks and other lenders when they borrow money. The rate influences interest rates that lenders such as Nationwide, NatWest etc charge for mortgages, loans and other types of credit.
If you’re on a fixed rate mortgage, nothing will change – you don’t need to do anything. Your interest rate and monthly payments stay the same until the end of your fixed deal, when your term comes to an end, you will need to speak to your mortgage adviser who can help get the best new rate for you.
If you’re on a tracker mortgage, variable rate mortgage or any other type of variable-rate loan, the repayments are linked to the new base rates. This means that as your monthly payments increase, so will the amount you pay back to your lender.
If you’re a first time buyer looking to buy your first property, it’s important that you collate all your documents such as payslips, ID and your credit file when you go to your adviser so that they can act quickly and secure the best deal.
If your fixed deal is coming to an end within the next 6 months then make sure you start the research process nice an early to give you the best chance of timing the market to get the best deals around.
If you’d like more information don’t hesitate to get in touch with us today on 01925 573 328 or email [email protected]
