The recent changes to Stamp Duty and the pent-up demand resulting from lockdown has led to a flurry of activity in the property and mortgage market.
Most Banks and Building Societies have many staff members working from home and are struggling to cope with volumes of applications.
The temporary changes in Stamp Duty have caused a surge in people looking to move home with a view to buying bigger properties or making a first move onto the property ladder.
Mortgages at over 75% of the property value have become scarcer, in particular at 90% where lenders are not able to support this market for a combination of reasons, but mainly due to being unable to meet servicing demands and being cautious over high risk lending. Mortgage providers are concerned over future property values and are a little reluctant to lend where smaller deposits are concerned. 85-90% mortgages are available, but lenders are dipping in and out of this market and rates are creeping upwards. This is generally to curb demand more than anything else. Nationwide, Accord and HSBC have been prominent at 90% but most lenders are steering a more cautious route.
We would warn applicants that your mortgage application may take a little longer than would normally be expected and if you are, or have been on furlough, you are likely to be more thoroughly underwritten than in previous times. Self Employed people will be asked about the impact of COVID on their business and how it has impacted upon income and whether the business is likely to suffer with reduced profits going forward.
Our message is that mortgages are available, but to seek professional advice.