Finance forum: Mortgage loan 20 articles - 5.437 readings

A mortgage loan is a loan agreement for purchasing real property. The mortgage on the property serves as collateral. In the contract, the person defined as the “lender” undertakes to give the “borrower” an amount, provided that the latter repays it under certain conditions. The repayment is usually made in installments consisting of repayment and interest. The interest rate can be fixed or variable based on the contract.

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Good news for mortgages: Bank of England keeps rates on hold

Posted on 03.11.2023

The Bank of England is also pausing its rate hikes. This appears to be good news for mortgages. Meanwhile, intermediaries are gearing up to offer competitive deals (but may also increase commission costs). BoE Monetary Policy Committee decides to extend rate hike pause The BoE's Monetary Policy Committee also followed the monetary policy decisions of the Federal Reserve and the European Central Bank. Interest rates will remain unchanged for the time being. Today the rate stands at 5.25%. A ...

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Eurirs and Euribor: how do mortgage reference rates work?

Posted on 13.07.2023

The cost of mortgages is directly linked to changes in interest rates. This is illustrated by the fact that rising interest rates have put pressure on the housing market and dampened demand for mortgages. In the euro area, the two intermediate benchmarks between ECB interest rates and mortgage costs are Eurirs and Euribor. The ECB's benchmark for the cost of money Rising interest rates have a direct impact on the cost of borrowing. The reason for this is easy to understand. In short, it co ...

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What are the trends for the mortgage market in Europe?

Posted on 04.01.2022

Many people will have wondered whether, with 2022 and changes in monetary policy in some countries, anything could change on the mortgage front.  It is therefore worth reporting some data and considerations from the European Mortgage Federation's (EMF) very comprehensive study, Hypostat 2021. The mortgage market in Europe How important are mortgages in Europe? They are very important, accounting for 46.1% of GDP. The Hypostat 2021 data speaks of 6.17 trillion for the Eurozone and if y ...

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New later life mortgages drop 7% in Q3 as equity release attractiveness increases

Posted on 09.12.2021

New later life mortgages dropped 7% quarter-on-quarter in Q3 2021, according to UK Finance’s Later Life Mortgage Lending Q3 2021 data. Total lending reached £6.46 billion for the quarter across 44,130 new later life mortgages. Despite the quarterly drop, the figure represents a 6% rise compared to Q3 2020.  The drop reflects the decline in the mortgages taken by individuals aged between 55 and 69. According to UK Finance, this follows the stamp duty holiday’s end and the ...

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Kensington Mortgage raises £463.7 million as investors oversubscribe to its Finsbury Square bond

Posted on 16.11.2021

Kensington Mortgages sold a £452 million mortgage-backed securities package. The specialist lender reported that investors oversubscribed to its Finsbury Square 2021-22 bond.  They added that 26 different accounts bought their senior and mezzanine tranches. Investors bought the senior debt at a price 80 basis points above the sterling overnight-index average. The deal will fund complex lending and underserved borrowers from its £463.7 million raise.  Kensington& ...

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HSBC and NatWest increase mortgage rates by up to 1%

Posted on 21.10.2021

If you’re buying your home with a larger deposit, you’re in for higher mortgage rates from HSBC and NatWest. The move comes as the banks fear higher inflation. HSBC raised their rates by almost 0.1% on its two-year fixed mortgages and longer. That means you can’t access three or five-year fixed deals lower than 1%. Mortgage brokers expect NatWest to follow soon. The move contradicts analyst suggestions that mortgage rates will go lower. These allegations relied on the premise ...

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HSBC, TSB race to swoon borrowers with 0.94% rates

Posted on 14.07.2021

UK mortgage price wars heat up as HSBC and TSB offer a 0.94% fixed-rate deal. The offer is marginally lower than the 0.95% best-buy on offer. The record low rates show how lenders’ eagerness to attract borrowers. Lenders are benefiting from the low Bank of England’s base rate of 0.1%. They’re also trying to maintain mortgage momentum after the stamp duty holiday ended in June.  HSBC deal specs HSBC is offering homebuyers and remortgagors this two-year fixed rate mortgage ...

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Renting v. buying: what’s cheaper?

Posted on 22.06.2021

For the first time in five years, renting is cheaper than buying a house in the UK. Pandemic-driven parameters are driving a housing boom. Demand is picking up as homebuyers look to rural dwellings with outdoor space and more work-from-home accommodation. According to Hamptons, rents are £71 cheaper than mortgage payments for first-time buyers securing a 90% LTV mortgage. A renter can expect a monthly rent payable of £1,054 versus the £1,125 monthly mortgage payment. Out of 11 ...

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The UK property market is booming - and so are mortgage bonds

Posted on 15.06.2021

Lenders are rushing to finance mortgages as the UK housing market booms. Ganesh Rajendra, managing partner at Integer Advisors, sees non-bank lenders seeking more securitization. Debt sold by non-bank lenders, so far, totaled ₤17 billion, the most in four years and double 2020 totals, according to Bloomberg data. Home-buyers are benefiting from Government incentives. Lenders, too, are benefiting from the monetary stimuli offered and accessing cheap funding. The majority of the offerings are ...

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