Explore Mortgage Strategy’s latest top 10 stories this week.
This week, highlights include Halifax lowering the maximum working age on selected products and FCA data revealing that the mortgage market may not be fit for purpose. Learn more here:
Halifax lowers maximum working age on selected products
Halifax Intermediaries has reduced the maximum working age from 75 to 70 on certain lending products. This adjustment applies to remortgage applications seeking additional capital, as well as purchase and remortgage applications with concerns regarding the borrower’s overall credit profile or credit score. The change follows the lender’s previous decision to increase the maximum working age for earned income from 70 to 75 in July 2023.
FCA data shows mortgage market not fit for purpose: Perenna
According to the FCA Mortgage Lending statistics for Q4 2023, the total outstanding value of residential mortgage loans slightly decreased by 0.1% to £1,658 billion compared to the previous quarter and was 1.1% lower than a year earlier. The value of gross mortgage advances fell by 13.4% to £54 billion from the previous quarter and was 33.8% lower than a year earlier. Additionally, the value of new mortgage commitments decreased by 6.6% to £46 billion compared to the previous quarter and was 21.2% lower than a year earlier.
Santander, Co-op, NatWest and Principality boost rates, launch products
Santander, the Co-operative Bank, and NatWest all announced changes effective from 12 March. Santander introduced a new 95% loan-to-value (LTV) two-year fixed-rate option for residential purchases. Additionally, the lender increased fixed and tracker rates in both new business and product transfer ranges.
Gen H becomes broker-only lender
Gen H has become a broker-only lender to enhance industry partnerships and will lower rates by up to 25 basis points. The lender is restructuring its business to prioritize an end-to-end service, alongside Gen H Legal. Karen Appleton joins as head of lending and Claire Pratt as head of financial crime risk to support this transition.
Metro Bank lifts mortgage book, plans to boost specialist lending
Metro Bank’s retail mortgage lending rose 2% to £7.8 billion compared to the previous year. Despite this growth, the bank plans to cut 1,000 jobs, intensify cost-cutting measures, and end seven-day branch openings following its autumn rescue deal. Moving forward, Metro Bank aims to focus on dominating niche segments of the mortgage market where its manual underwriting capacity offers a competitive advantage.
UK housing shows clear green shoots in 2024: Bloomberg
Around 40% of UK house hunters are speeding up their purchasing plans, fearing rising prices, according to Bloomberg Intelligence’s latest survey. Senior real estate analyst Iwona Hovenko highlighted that lower mortgage rates since 2023 are reviving housing activity. The survey shows 41.5% of prospective buyers accelerating plans, up from 35% mid-2023 and 31.2% in October 2022. Additionally, fewer respondents are delaying moves, dropping to 8.5% in February from about 13% last summer and Q4 2022.
Empty homes double council tax charge takes effect in April: DLUHC
From April 1st, owners of empty homes will be subject to double council tax charges, with a 100% surcharge if the property remains vacant for 12 months. Additionally, councils will gain new powers to levy a tax premium on second homes, aiming to boost public service funding or mitigate overall council tax bills.
Rise in mortgage arrears a cause for concern: Quilter
In the fourth quarter of 2023, the Bank of England reported a 9.2% increase in outstanding mortgage balances with arrears, totalling £20.3 billion. This represents a 50.3% rise compared to the previous year. Additionally, the proportion of total loan balances with arrears rose to 1.23%, the highest level since 2016.
Mortgage product shelf-life’s tumble to 15 days: Moneyfacts
According to data from Moneyfacts, the average shelf-life of a mortgage product plummeted to a six-month low of 15 days as lenders increased rates. This is a sharp decline from 28 days recorded at the beginning of February, as highlighted in the Mortgage Trends Treasury Report. The report notes that the last time the lifespan of home loans was this short was in September, with the previous record low of 12 days posted in July.
Assessing the risks of spray foam insulation
Simon Baker, Global President of Huntsman Building Solutions, highlights the risks and benefits of spray foam insulation in mortgage lending. While it offers energy efficiency advantages, misinformation and inadequate documentation pose challenges for lenders. Baker stresses the importance of proper documentation, such as product certification and warranties, to mitigate risk. Huntsman Building Solutions advocates for dialogue with lenders to facilitate informed decisions and support homeowners in improving property energy efficiency.
