Mortgage lenders in the UK continue to support the market with excellent value products

Another month has passed with no change to the Bank of England base rate following the monthly Monetary Policy Committee meeting earlier in September. Recent debate has been focused upon whether the MPC would vote to recommence the process known as quantitative easing, in essence the printing of money, to stimulate the economy due to persistent growth weakness.

Once again the vote was for no increase in the process known as the “asset purchase programme”, but with the economy having been confirmed to have grown by only 0.2% in the second quarter of this year, we may be approaching the point where the policy setters are required to apply further medicine to what appears to be a patient still very much in intensive care.

Mortgage lenders in the UK continue to support the market with excellent value products. Although we saw borrower numbers in August reduce by approximately 3% compared to July, this can largely be attributed to seasonal factors. In the same period in 2010, we witnessed a significant rise in activity in both the purchase and remortgage sector as people continue to take advantage of the excellent value of rates offer relative to historic levels.

Average mortgage rates for two year fixed rate deals were 4.27% in August, but five year fixed rates have fallen below that psychologically important 5% level with Moneyfacts reporting that average five year deals now stand at 4.93%.

The number of mortgage products has decreased to the 6,500 level, but is still significantly ahead of the corresponding period in 2010 when intermediaries would typically have only had access to approximately 4,600 deals. This provides further evidence that the market (although nowhere near back to what we would have called “normal”) is in a much healthier position now than twelve or twenty four months ago.

Nigel Tennant is from Mortgage Advice Bureau. For further information on how the latest base rate decision affects you, please call 07779 135191 or e mail nigelte@mab.org.uk or visit the website at www.mortgageadvicebureau.com/barbers

Alternatively, please visit our Contact Us page to contact one of Barbers Branches.

Your home may be repossessed if you do not keep up repayments on your mortgage. A fee of up to 1% of the mortgage amount may be charged depending on individual circumstances. A typical fee is £95.