Mortgage arrears and repossession seems to be at it highest in the last 10 years.
Citizens Advice reports show that home owners in England and Wales saw mortgage arrears rise by 35% in the first two months of 2008 compared to 2007. With the increase in living costs such as Gas, Electric, food, borrowers are finding it increasingly difficult to afford their debt payments.
This comes at a time when many borrowers are coming out of their fixed rates, reverting to the standard variable rate which sees an increase in their mortgage payments by over £200.
Lenders are being very picky to who they lend to, therefore many people should use mortgage brokers to source the best products to suit their circumstances.
Scenario
Client is coming out of a 3 year fixed rate at 4.59%. The loan amount is £120,000, the property value is£ 400,000. If the client has good credit they may be eligible for a Abbey fixed rate 5.89% with a free valuation and £250 cash back or Cheltenham & Gloucester fixed rate 4.99% free valuation but £99 booking fee.
If the client has bad credit e.g. 2 missed mortgage payments in the last twelve months they will be eligible for a Future Mortgages 6.95% 2 years fixed
