Remortgages And Mortgages Before And During The Recession.
Remortgages, mortgages and secured loans all form part of what are known as home loans. This being the case means that they are only granted to homeowners.
A mortgage is a form of home loan taken out by either a first time buyer or a home mover to purchase a property.
A remortgage is a home loan that takes the place of an existing mortgage.
Remortgages and mortgages are based on the equity of a property , and equity is the difference between the value of a property and the mortgage balance. This means that if a property is worth 300,000 and the mortgage balance or the required remortgage is 150,000 the available equity is 150,000.
Before the credit crunch there was availability of 100% mortgages and remortgages with the Northern Rock advancing 125% mortgages which helped towards their downfall.
Many out there may think that the 125% mortgage is back with the announcement a few months ago by the Nationwide that they are advancing 125% mortgages. This is not available to other than existing Nationwide customers trapped in their current property by negative equity who need to buy another place to live.
If they need a mortgage to move to another house the Nationwide are willing to grant them 125% of the property value to assist them.
There are still a few building societies granting mortgages and remortgages at 90% and very very occasionally 95% LTV, which would mean that if a property is valued at 200,000 on a 90% plan the maximum mortgage or remortgage would be’0,000.
The most important feature lenders consider now after status is the equity in a property,and interest rates for both mortgages and remortgages are available at 1.98% at a maximum LTV of 60%.
Another major difference pre and in the middle of the recession is the situation regarding pure self certifications of self employed earnings. Only two building societies even consider self declarations now, but even at the last minute they may require further income proof in official format.
Before the credit crunch self certification was rife, and this in fact precipitated the recession itself.
Remortgage and mortgage criteria have very much tightened up and this could do with being relaxed a little.
Want to find out more about mortgages then visit Champion Finance’s site and choose the very best mortgage for you.
categories: refinancing,real estate,home loans,remortgages,secured loans,mortgages,home improvements
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