The common coronavirus is showing its effect on the UK mortgage market. The lenders and the brokers are practising a partial lockdown. It has sent the borrowers in doubts on their deals. However, at the same time, the lenders have given clarity that it will not affect the existing mortgage applications.
The mortgage companies are eager to help their existing clients in the best possible way. To make sure that the market is stable and not in terrible condition, the lenders are not putting a full stop to everything.
The new application too will be accepted, but the lenders have done considerable changes in their LTV ratio.
The renowned names that have changed the LTV ratio include Santander and Skipton, and both have 60%. Barclays, Virgin Money, Halifax have brought it to 65%. Some lenders still dare to offer up to 75% LTV. This will directly affect the deposit size. Several mortgage providers are ready to offer funds to only those with a minimum of 25% equity.
What is the bigger picture?
The Lenders have made clear that the withdrawal of the mortgage products with higher LTV percentage is only temporary. The lending companies need to access the level of risk that they may need to confront. Once the life comes back to its average pace and the Covid-19 restrictions are over, the finance companies commit to bringing back the same benefits.
The property loan providers have also extended the period to 3 months for those who have exchanged the contracts. Many that are planning to move to their new house may have to wait until the mess gets over.
The new home buyers cannot go outside to visit the properties. This tells that people need to depend more on online valuation. Also, in finding the deals, online mortgage brokers are now playing an important role.
In the end, the complete UK mortgage market is in ‘fingers crossed’ situation with the hope that things will become normal soon.