advisor Archives - Choice Mortgages UK

The Evolution of Mortgage Lending in 2024

15th March 2024

Notable shifts in mortgage lending in the UK are poised to impact the real estate market in 2024. As we anticipate a return to pre-Covid lending levels, understanding these changes is crucial for anyone looking to purchase property and with the help of this comprehensive overview, we’ll explore what lies ahead.

Current trends and predictions

In 2023, UK mortgage lending experienced a significant downturn, with a staggering 23% decrease. As we move through 2024, projections suggest an additional 8% decline, signalling a challenging period for the industry. This decline is expected to continue until a modest recovery in 2025, when figures may return to mid-2010 levels, ranging between £120-130 billion.

Factors influencing the decline

Affordability challenges

Affordability remains a primary concern driving the decline in mortgage lending. Factors such as higher interest rates, elevated house prices relative to income, and increased cost-of-living expenses have created a constrained borrowing environment for prospective homeowners. The current Bank of England base rate is 5.25%.

In navigating these challenges, individuals and families can benefit from partnering with Choice Mortgages UK, an independent mortgage broker committed to offering tailored solutions and accessible support. Additionally, Choice Mortgages has over 30 years of experience with finding clients the perfect mortgages, taking into account their financial well-being and the current market conditions.

Uncertainty ahead

The prospect of a general election before 28 January 2025 adds further uncertainty to the housing market. Historically, such events have prompted a temporary pause as buyers and sellers await clarity on how political changes might impact the economy and property values.

Transaction volumes

The impact of affordability challenges and uncertainty is reflected in transaction volumes, which are predicted to hover around 1 million in 2023, 2024, and 2025. This represents a 15% decline compared to pre-Covid averages.

For those entering into a property transaction, Choice Mortgages UK’s team of experienced advisers stands ready to address both straightforward and complex queries, ensuring a seamless process tailored to your individual needs. Choice Mortgages will get to know you and understand your requirements.

Also, you won’t have to deal with lots of different people and departments – you’ll get a same-day response whether it’s answering a call, responding to your email, or inviting you to leave a detailed message.

Expert perspectives

Despite these challenges, Emma Cox, managing director of real estate at specialist lending bank Shawbrook, has a positive outlook for the year ahead, referring to the dip in residential property transactions as, “a minor speed bump in an otherwise positive start to the year.”

Furthermore, James Tatch, Head of Analytics at UK Finance, acknowledges the difficulties faced by mortgage borrowers and anticipates a gradual improvement in affordability by 2025.
Remaining with a bright outlook, Lucian Cook, Head of Residential Research at Savills, highlights the stabilising effect of falling inflation on mortgage rates, suggesting that the housing market may have passed its peak difficulties.

Looking into the future

As we forge forward, it’s vital to stay informed and seek expert advice. Choice Mortgages UK offers free consultations, flexible communication options, and access to a wide range of lenders, ensuring unbiased and personalised solutions for every client.

So, while challenges persist, proactive decision-making and strategic partnerships can help you to navigate the real estate market with confidence. For reliable guidance and support, trust Choice Mortgages UK to help you find the right mortgage solution.

A Step-by-Step Guide to Buying a Home in the UK

20th November 2023

Deciding on buying a home is an exciting time, but it can be riddled with uncertainties, making the process time-consuming and complex. The UK’s average timeline for purchasing a property is about six months [link to: https://hoa.org.uk/advice/guides-for-homeowners/i-am-buying/how-long-does-it-take-to-buy-or-sell-home/], and based on different factors; this can vary. Still, things like your financial situation, the type of property you’re investing in, and the seller’s circumstances can all impact your timeline.

We’ve broken the process down into steps to help provide a picture of what you can expect along the way.

Step 1: 24 hours – Application for a Decision in Principle

A Decision in Principle is your initial step in the home-buying process. It estimates how much you could borrow, giving you a clear idea of the budget for your property search. Most lenders offer the convenience of applying online, with many providing instant decisions, typically within 24 hours. This crucial step ensures that you start clearly understanding your financial boundaries.

Step 2: Varies – Search and make an offer on a home

The time it takes to find your ideal property can vary significantly, ranging from a few weeks to several months. It’s important to take your time during this phase, researching your preferred area thoroughly to make an informed decision. Once you’ve found a property, the following steps may differ between regions.

In England, Northern Ireland, and Wales, making an offer is typically done through an estate agent, who should provide information on the response time.

In Scotland, you’ll need to engage a solicitor to help you prepare a bid. Since a successful bid in Scotland can legally commit you to the purchase, it’s crucial to have a Decision in Principle and be ready to proceed with a mortgage application.

Step 3: Up to 2 weeks – formally applying for a mortgage

Once your offer is accepted, you can apply for a formal mortgage offer. We recommend your mortgage application is submitted as soon as possible, although there may be exceptions based on specific circumstances. Processing and receiving a formal mortgage offer can take approximately 4-6 weeks. To expedite this phase, ensure you have all the necessary documents ready for review. The application includes thorough checks of your finances and a mortgage valuation of the property you intend to buy carried out by the lender.

What is the time between the mortgage offer and completion?

Typically, you can expect the completion process to take around 12 weeks once your mortgage offer has been accepted. However, it’s important to note that each property transaction is unique, and the timeline may vary. Your journey to homeownership may take less or more time than the standard 12 weeks.

Step 4: 6 to 12 weeks – conveyancing

Appointing a solicitor or a licensed conveyancer is essential for handling the legal aspects of your property purchase. The conveyancing process may range from approximately six weeks to a few months, particularly if you become part of a property “chain”. A chain forms when multiple transactions need to happen and involve other buyers and sellers in the process.

Step 5: 2 to 3 weeks – property survey

Conducting a property survey is advisable to identify potential issues with the property. Surveyors provide a report within a couple of weeks of conducting their inspection, which generally takes a few hours. This survey differs from the mortgage valuation, which is typically for the lender’s use.

Sellers in Scotland would provide a Home Report containing an energy performance certificate, a survey and a property questionnaire, which a solicitor would then review.

Step 6: 1 to 4 weeks – contracts exchange to completion

Once you have your mortgage offer and your solicitor or licensed conveyancer is satisfied with the property’s search results, enquiries, and legal title, you’re all set to exchange contracts (the specific process differs in Scotland).

If you’re part of a property chain, all buyers and sellers involved must be prepared, which could cause delays.

You’ll provide your deposit upon exchanging contracts, and the agreement becomes legally binding. At this point, you’ll need to have buildings insurance in place. The completion date is agreed upon during this phase, often set approximately two weeks after the exchange, but it can be adjusted as needed. You’ll usually receive the keys to your new home on the completion date.

Moving forward with Choice Mortgages

At Choice Mortgages, we provide independent, professional guidance and advice tailored to specific requirements. Feel free to use our no-cost and no-obligation consultation by phone or in person at the office. Our team of experienced and friendly advisors can handle all of your queries. Whether they’re straightforward or more complex, we’re on hand and ready to help. Remember, your home may be repossessed if you do not keep up repayments on your mortgage.

What to look for in a Mortgage Advisor

9th February 2023

Whether you’re a first-time buyer or a seasoned property investor, having a trustworthy and knowledgeable advisor is essential to obtaining a mortgage. With the right help, you can navigate the complex and ever-changing world of mortgages and find the best alternatives and rates to make the best-informed choice. Choosing the right professional should take into account crucial factors.

Here are essential qualities to look for when choosing a mortgage advisor:

Choosing a mortgage advisor – key qualities

Expertise and Experience

A good mortgage advisor should thoroughly understand the current mortgage market, including regulations, trends, and all recently available products. Look for an advisor who has been in the industry for several years and has a proven track record of helping clients secure the best mortgages for their needs.

Independence

Choosing an advisor who is not tied to any particular lender or financial institution is essential. An independent advisor will have access to a vast range of mortgage products and rates, giving you the best opportunity to find the right mortgage for your financial position without any restrictions or bias.

Personalisation

It’s a two-way street, so take your time and research to find an advisor who is invested in you. A good mortgage advisor should try to get to know you and understand your goals and needs. This level of personal service is vital in helping you to ask questions and feel comfortable with your decisions.

Communication

A good mortgage advisor should be easily relatable, and customer-focused. Look for an advisor who is responsive, approachable, and provides clear and concise information.

Completeness of Service

Having part of the information and being left to Google to find your way around what to do next is of no use. A good mortgage advisor should guide you through the entire mortgage process, from start to finish. Look for an advisor who will complete all the necessary paperwork, keep you updated on the progress of your application, and ensure that the process is smooth by foreseeing any potential challenges along the way.

Availability

When looking for a mortgage advisor, it is important to consider their availability. You want an advisor who can organise appointments that work with your schedule and is available to answer questions, provide support when you need it, and not leave you hanging.

Fee structure

Some mortgage advisors charge fees for their services, while others are compensated by the lenders they work with. Much like the services of a solicitor or an accountant, the professional services of a mortgage advisor need to be taken into account. Make sure you understand the fee structure of the advisor you are considering so that you know what to expect and plan for contingencies.

Reputation

Look for an advisor who has a good reputation in the industry and is well-regarded by their clients. Read reviews, check ratings, and ask for referrals to ensure you choose a trustworthy advisor.

In conclusion, when choosing a mortgage advisor, it is crucial to consider their expertise, independence, personalisation, communication, completeness of service, availability, fee structure, and reputation. By finding the right mortgage advisor for your needs, you can be confident that you are making an informed and intelligent decision about your mortgage.

At Choice Mortgages, benefit from personalised and efficient services with over 100 years of experience from our team of reliable advisers.

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