New rescue package to help bank’s start lending again. Gordon Brown will announce plans to guarantee mortgage lending tomorrow. Will this be the news first time buyers have waiting for?

Banks need to start lending again to prevent the housing market sliding further. With little or no confidence in house prices most buyers are sitting on the fence waiting for prices to stabilise before they risk purchasing their next house. This is unlikely to happen until credit becomes available again.

There is hope that the Governments new attempt to stimulate the mortgage market will prevent the housing market crashing even further. Ever since securitisation collapsed in 2007 lending has dried up all but for a few customers with the best credit records and a large deposit.

 The new bail out package which has been recommended by ex-bank boss Sir James Crosby is specifically aimed at boosting the mortgage market. This in turn would help property prices stabilise. It’s the shortage of affordable mortgage loans that is contributing to the slide in house prices. First time buyers have been priced out of the market.

If you want to know more about first time buyer schemes, then contact Click n go Mortgages here.

The Council of Mortgage lenders (CML) have reported that their was only 33,000 new loans granted in November, that’s a 17% reduction compared with last month. First time buyers are finding that they have to put down a large deposit. On average a first time buyer has to put down an 18% deposit of the properties value.

Larger deposits protect lenders from falling house prices. For 95% or even 90% mortgage products to find there way back into the mortgage tables house prices will have to stabilise. When you take a mortgage out the property is used as security against the loan. Banks are restricting there lending to the lowest risk investments therefore providng a wider margin of equity as protection.

The CML predicted that lending would fall further in the next few months.

“Limited mortgage funding and reduced consumer demand will weaken lending activity further in coming months,” said the CML’s director general, Michael Coogan.

“The flow of funds to the mortgage market will not improve this year without further intervention by government,” he warned.

Borrowers are being advise to use any savings from mortgage rate reductions to reduce there loan thus decreasing there loan to value against there property. By doing this you will stand a better chance of getting the best mortgage deal available when your current deal comes to an end.

If you want to know more about first time buyer schemes, then contact Click n go Mortgages here.

October house price fell by 2.2% in October, which pushes the overall figure to 13.7% for the house price drop for the past year according to Halifax.

The average cost of a home in the UK is now set at £168,176 which is nearly £30K less than it was a year ago.  This means that we are looking at prices as they were in October of 2005.

The market, according to lenders, is challenging because of the economic strife and the dearth of mortgages.

Nationwide have reported a drop of 14.6% in house prices over the past year, whilst simply comparing prices suggests a 15% drop.

Despite the continuous speculation that the housing market is going to get worse before it gets better, the Halifax’s chief lender thinks that there are signs of the market starting to stabilise as house prices become more affordable.

The price of a house in comparison to earnings ratio has fallen below 5.0, which is the first time in 4 years.  There is hope that the ratio will improve further over the forthcoming months.

House prices are now falling at a faster rate than that of the recession in the 90s and will mortgage lending at an all time low, it is likely that this will continue.Interest rates have been cut by the Bank of England, which should give relief eventually to high street rates.  At this juncture the problem is not so much the fact that mortgages are tough to pay back, but the fact that the size of the deposit that is needed to get a mortgage in the first place is often out of the reach of many.

The credit crunch has seen a turn-around for lenders with many only preparing to lend to borrowers with significant equity in their existing homes or those who are able to put down sizeable deposits.  Banks and building societies are set to restrict their lending more over the forthcoming months for those who are first time buyers, making the Governments Shared Ownership and New HomeBuy Schemes more inviting.

The days of 100% and even 95% have gone and most deals will require a 15% deposit, so for many Shared Ownership is providing a life line to the property ladder.

If you want to know more about shared ownership schemes, then contact Click n go Mortgages here.

Following the recent down turn in the market, we will be looking at a more sensible and stable housing market.

The credit crunch has called for officials to analyse the mistakes that have been made and we are being told that the days of mortgages valued at five times a salary are over, as are inflated house prices.

Although the credit crunch caught many off guard – many who have been living on the credit – the credit crunch will now correct the problems caused by lending to those who cannot afford repayments.

The credit crunch, will leave in its wake, many repossession and the end of property ownership dreams as well as negative equity, but hopefully this will be the last time that we such an economic decline.

The problem, that many are now facing up to, is the fact that borrowing more than you could actually afford was only going to land you in hot water.

Fault has rightly be placed with the banks and The Bank of England is calling for tighter controls on the way that money is lent.We were living in a credit bubble that has now burst.Property shows that glorify and ‘fuel the greed’ for easy money have also been blamed and it is worth noting that although people have made money through property development, these people are few.

The days of being obsessed with the value of your home is over and a time when we bought a house because we fell in love with it is just around the corner.   We are going to go back to saving and buying a property because it suits the needs of our family and it is where you want to live.

The Government is now tackling this by pushing shared ownership and affordable housing.  This type of social housing is giving people the chance to get onto the property ladder without getting further into debt and having a realistic idea of what they can actually afford.If you want to speak to an expert about your mortgage or a shared ownership mortgage, then contact Click n go Mortgages on 0845 0945 474 or email us here.

September has seen a record 8% fall in annual house price figures in England and Wales.

The 8% figure is almost double that of August, giving more fuel to the fire that an estimated 1.2 billion people will be living in homes worth less than their mortgage.

The fall last month is biggest annual drop after August’s 4.6% drop, which was a record on its own.

This is the 13th month that the annual rate of house price growth has declined and more evidence of the pending recession.Wales has seen a huge slide of 10.7%, making it the only region to have a double digit dive.  This is quickly followed by the East Midlands and South West, with 9.9% and 9.7% falls.

The South West, South East, North East and East Midlands have seen drops of 2% with Yorkshire and the Humber recording drops of 1.2% in September.

London, typically, is still just about holding onto its house prices and has had the smallest year on year comparable decline of 6.1%, followed swiftly by the North West with a mere 6.3%.

The story goes that we are going to be looking at a 50% overall drop in house prices, over the forthcoming months, so with this in mind should we all be buying in London?  Let us know what you think of this story.  If you have any questions about your mortgage, or how you can get onto the property ladder in these ‘dark days’, then get in touch with Click n go Mortgages.