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Daily Mirror
15-05-2025
- Business
- Daily Mirror
Nationwide announces change to mortgage rules in major first-time buyer boost
The high street lender has reduced its stress rates - which are used to determine if they can afford to continue to pay their mortgage if interest rates rise - by between 0.75 and 1.25 percentage points Nationwide has announced a major change to its mortgage affordability calculation from today. The high street lender has reduced its stress rates by between 0.75 and 1.25 percentage points. A stress test is used to determine whether a borrower can afford to continue to pay their mortgage if interest rates rise. This is normally set at a certain percentage point above the lender's standard variable rate (SVR). Nationwide says the change means borrowers will be able to borrow £28,000 more on average from today. It applies to first-time buyers - who can also benefit from the Helping Hand mortgage, which lets eligible applicants borrow up to six times their income - as well as home movers fixing their deal for at least five years. The largest boost to the borrowing amount is expected on remortgages where there is no additional borrowing. Nationwide says these fall outside the flow limit and are therefore unlikely to be capped at 4.5 times income. Nationwide estimates that a first-time buyer using the Helping Hand mortgage and with a £55,000 salary will see the maximum amount they can borrow jump from £304,200 to £330,000. Someone moving home with an income of £75,000 will be able to borrow £336,800, up from £307,000, while those who are remortgaging on a £45,000 salary will be able to borrow up to £278,100, up from £235,500. Henry Jordan, Nationwide's Director of Home, said: 'Affordability remains a key challenge and this change, along with our well-established and popular Helping Hand proposition, shows we're serious about tackling it. 'Whilst the FCA's clarification on affordability stress rates could support increased levels of home ownership, the Bank of England's flow limit dampens its potential impact. 'That's why Nationwide continues to call for a review of the 15% limit, so that we, and other lenders, can help more people access the long-term benefits of home ownership.' Santander was the first major lender to reduce its stress test rates and said it means someone applying for a residential mortgage can now borrow between £10,000 to £35,000 more, depending on their individual circumstances. HSBC also followed suit, and said 20,000 more customers are able to get a mortgage, alongside being able to borrow larger amounts. The average increase in offer for first-time buyers will be £39,000. Lloyds Banking Group has also reduced the stress rates used in its standard affordability calculation and on its five-year fixed mortgages. and said it could mean someone applying for a mortgage could borrow £38,000 more. This includes Lloyds, Halifax, Bank of Scotland and BM Solutions.
The Independent
13-05-2025
- Business
- The Independent
Mortgage lending ‘checker' launched by Rightmove and Nationwide Building Society
Rightmove and Nationwide Building Society have launched an online feature which could indicate to house-hunters whether a specific property may be eligible for mortgage lending. The new digital 'property lending check' aims to give house-hunters more clarity earlier on in their moving process, by giving real-time information about the potential for getting a mortgage on a home, before they even physically view the property or put in an offer. Nationwide will assess typical property risks on a listing, such as flooding, or short lease lengths, to indicate whether or not it would be likely to lend on the property. Rightmove said it takes more than five months on average to complete a home sale and the new feature could help make the process more efficient. The new feature is an addition to Rightmove's mortgage in principle, a feature which has also been created in association with Nationwide and helps people to understand how much they are likely to be able to borrow. House-hunters who start the mortgage in principle process via a listing page will have the option to check if that property listing is likely to be eligible for a mortgage during the application process. Matt Smith, Rightmove's head of mortgages, said: 'This is a first rollout phase, and we'll be making lots of enhancements to the property lending check over the coming months.' Henry Jordan, Nationwide's director of home, said: 'We know that people who find a property listing they like are keen to know whether they'll be able to get a mortgage on it. So, the launch of the property lending check feature is the natural next step.' Nicholas Mendes, mortgage technical manager at broker John Charcol, said: ' One of the biggest frustrations for buyers is discovering, often after they've found their dream property and submitted an application, that it isn't eligible for a mortgage with that particular lender. 'While a broker can do their utmost to prevent this from happening, there are times when factors are out of their control. For example, how a surveyor assesses a property or lender-specific criteria that only come to light during internal underwriting processes. 'Some issues, like a short lease or a known flood risk, are slightly easier to identify early on. But being able to get a clearer sense of a property's mortgage eligibility before even booking a viewing could save people a lot of time and stress.' Mr Mendes also said it is worth remembering there are many lenders in the market, and they will each have their own appetite for risk. He said brokers 'can help sense-check whether a potential purchase is genuinely off the table or if there might still be a workable route forward'. Stumbling blocks when looking for finance can sometimes arise with properties with short leases, those built from non-standard construction materials, homes in high flood-risk areas, flats above some commercial premises, and properties with structural issues such as subsidence, serious damp or roof problems, Mr Mendes said. He added: 'Some lenders are also cautious with new-build properties, especially when they believe the asking price has been inflated above market value. In these situations, buyers may find the mortgage offer is lower than expected.'
The Independent
13-05-2025
- Business
- The Independent
New mortgage tool set to make buying a house much easier
Rightmove and Nationwide Building Society have partnered to launch a new online tool in a move aimed at streamlining the home-buying process. This " property lending check" feature provides prospective buyers with early insights into a property's mortgage eligibility, even before viewings or offers. The tool assesses common property risks, such as flood risk and short lease lengths, to provide a real-time indication of whether Nationwide would likely lend on a specific property. With the average home sale taking over five months, this feature could significantly reduce wasted time and effort for buyers pursuing properties unlikely to secure mortgage approval. This new addition complements Rightmove's existing "mortgage in principle" feature, also developed with Nationwide, which helps users estimate their borrowing capacity. Now, when initiating a mortgage in principle application through a property listing, buyers can simultaneously check the property's potential mortgage eligibility. This combined approach empowers buyers with crucial financial information early in their search, potentially leading to a more efficient and less stressful home-buying experience. Matt Smith, Rightmove's head of mortgages, said: 'This is a first rollout phase, and we'll be making lots of enhancements to the property lending check over the coming months.' Henry Jordan, Nationwide's director of home, said: 'We know that people who find a property listing they like are keen to know whether they'll be able to get a mortgage on it. So, the launch of the property lending check feature is the natural next step.' Nicholas Mendes, mortgage technical manager at broker John Charcol, said: 'One of the biggest frustrations for buyers is discovering, often after they've found their dream property and submitted an application, that it isn't eligible for a mortgage with that particular lender. 'While a broker can do their utmost to prevent this from happening, there are times when factors are out of their control. For example, how a surveyor assesses a property or lender-specific criteria that only come to light during internal underwriting processes. 'Some issues, like a short lease or a known flood risk, are slightly easier to identify early on. But being able to get a clearer sense of a property's mortgage eligibility before even booking a viewing could save people a lot of time and stress.' Mr Mendes also said it is worth remembering there are many lenders in the market, and they will each have their own appetite for risk. He said brokers 'can help sense-check whether a potential purchase is genuinely off the table or if there might still be a workable route forward'. Stumbling blocks when looking for finance can sometimes arise with properties with short leases, those built from non-standard construction materials, homes in high flood-risk areas, flats above some commercial premises, and properties with structural issues such as subsidence, serious damp or roof problems, Mr Mendes said. He added: 'Some lenders are also cautious with new-build properties, especially when they believe the asking price has been inflated above market value. In these situations, buyers may find the mortgage offer is lower than expected.'
Yahoo
24-04-2025
- Business
- Yahoo
Major lenders bring back under-4% mortgages amid interest rate cut hopes
Almost all major lenders have brought back under-4% deals this week, offering some respite for borrowers in an apparent response to the financial turmoil sparked by the US trade tariffs that changed expectations on UK interest rates. The average rate for a two-year fixed mortgage stands at 5.14%, while five-year fixed deals average 5.31%, according to data from Uswitch. The Bank of England held its interest rate at 4.5% last month after warning that global economic uncertainty has "intensified". This is the lowest level for rates in more than 18 months, following a reduction from 4.75% in February, the third such cut since August 2024. Financial markets and economists predict that the Bank of England will reduce borrowing costs more than expected this year to avoid a downturn. The primary inflation measure, the Consumer Price Index (CPI), stood at 2.6% in the 12 months to March 2025, a slight decrease from the previous month. That means that prices have been rising at the slowest pace since December and are closer to the BoE's 2% target. Most economists are predicting that the main borrowing rate will be cut on 8 May from its current 4.5% to 4.25%. This week, NatWest (NWG.L) cut its interest rates across its mortgage products and is now offering 3.94% for a two-year fix. Halifax has also entered the under-4% space with its own 3.94% deal . Read more: Mortgage rates rising despite Bank of England interest rate cuts At Nationwide (NBS.L), those with a 40% deposit can get a 4.09% rate on a two-year fix, with a £1,499 fee, or a 4.14% rate with a £999 fee. Henry Jordan, of Nationwide, said: 'We know that rate is an important factor for borrowers looking to buy their first home or move onto their next. "These latest cuts should put Nationwide firmly on the radar for first-time buyers and home movers as we continue to be one of the most competitively priced lenders in the market." Barclays (BARC.L) was the first major lender to enter the sub-4% fixed-rate market last week. HSBC (HSBA.L) and Santander (BNC.L) are yet to cross this threshold for first-time buyers. HSBC (HSBA.L) has a 4.12% rate for a five-year deal, unchanged from the previous week. For those with a Premier Standard account with the lender, this rate is 4.07%. Looking at the two-year options, the lowest rate is 4.10% with a £999 fee, also unchanged from the previous week. Both cases assume a 60% loan-to-value (LTV) mortgage, meaning buyers need to have at least 40% for a deposit. HSBC offers 95% LTV deals, meaning you only need to save for a 5% deposit. However, the rates are much higher, with a two-year fix coming in at 5.29% or 5.07% for a five-year fix. This is because their financial situation and deposit size determine the rate someone can get. The larger the deposit, the lower the LTV, allowing buyers to access better deals because lenders consider them less risky. NatWest (NWG.L) has a five-year deal coming in at 4% with a £1,495 fee, lower than the previous 4.13%. The cheapest two-year fix deal is 3.94%, also lower than the previous 4.14%. In both cases, you'll need at least a 40% deposit to qualify for the rates. At Santander (BNC.L), a five-year fix is 4.16%, unchanged from the previous week. It has a £999 fee, assuming a 40% deposit. For a two-year deal, customers can also secure a 4.01% offer, with the same £999 fee, which is lower than last week's 4.08%. Read more: Bank of England poised to cut interest rates in May Santander has also introduced mortgage products tailored to first-time buyers with large loans. These feature two- and five-year fixed-rate deals at 60% LTV, albeit with a higher £1,999 product fee. Barclays (BARC.L) has brought back its under 4% deals, with a five-year fix at the lender now at 3.99%, unchanged from the previous wee. For "premier" clients, this rate drops to 3.98%. The lowest you can get for two-year mortgage deals is 3.99%, also untouched from the previous week. Barclays has launched a mortgage proposition to help new and existing customers access larger loans when purchasing a home. The initiative, known as Mortgage Boost, enables family members or friends to effectively "boost" the amount that can be borrowed toward a property without needing to lend or gift money directly or provide a larger deposit. Under the scheme, a borrower's eligibility for a mortgage can increase significantly by including a family member or friend on the application. For example, an individual with a £37,500 annual income and a £30,000 deposit might traditionally be able to borrow up to £168,375, enabling them to purchase a home priced at around £198,375. However, with Mortgage Boost, the total borrowing potential can rise substantially if a second person — such as a parent — joins the application. In this case, if the second applicant also earns £37,500 a year, the combined income could push the borrowing limit to £270,000, enabling the buyer to afford a home worth up to £300,000. Nationwide (NBS.L) offers a five-year fix at 4.14%, with a £999 fee and a 40% deposit. This is lower than last week's 4.49%. Nationwide offers a two-year fixed rate for home purchase at 4.09% with a £999 fee — also for borrowers with a 40% deposit. This is also lower than the previous 4.34%. Read more: Best credit card deals of the week The lender has announced it is changing the eligibility criteria for its mortgage scheme, which allows people to borrow up to six times their income. The minimum income required to take out a Helping Hand mortgage has been reduced to £35,000 — meaning more people will be eligible for the scheme. The minimum income requirement for joint applications will remain at £55,000. Helping Hand mortgages enable people to borrow up to six times their income, meaning potential homeowners can borrow 33% more compared to Nationwide's standard lending at 4.5 times income. Halifax, the UK's biggest mortgage lender, offers a five-year rate of 4.1% (also 60% LTV), lower than the previous 4.17%. The lender, owned by Lloyds (LLOY.L), offers a two-year fixed rate deal at 3.94%, with a £999 fee for first-time buyers, which is also lower than last week's 4.06%. It also offers a 10-year deal with a mortgage rate of 4.78%. Read more: 8 luxury homes for big-budget buyers The lender has enhanced its five-year fixed mortgage products by increasing borrowing capacity. This improvement allows borrowers to access up to £38,000 more, enabling them to secure larger mortgages based on individual incomes. Rachel Springall, finance expert at Moneyfacts, said: "The flourishing choice of low-deposit mortgages will no doubt be welcomed by borrowers who are either looking to remortgage or are a first-time buyer. "The government has been clear that it wants lenders to do more to boost UK growth, and so a rise in product availability for aspiring homeowners is a healthy step in the right direction." With the recent adjustments, sub-4% mortgage deals are making their way back to major lenders. Barclays' 3.99%% is currently the cheapest deal for both five-year while NatWest's 3.94% is the lowest for two-year fixes among the top banks, though both require a 40% deposit. The average UK house price is £366,189, so a 40% deposit equates to about £147,000. A growing number of homeowners in the UK are opting for 35-year or longer mortgage terms, with a significant rise in older borrowers stretching their repayment periods well into their 70s. Read more: Home renovation mistakes and how to avoid them Lender April Mortgages offers buyers the chance to borrow up to six times their income on loans fixed for five to 15 years, from a deposit of 5%. Both buying alone and those buying with others can apply for the mortgage. As part of the independent Dutch asset manager DMFCO, the company offers interest rates starting at 5.20% and an application fee of £195. Skipton Building Society has also said it would allow first-time buyers to borrow up to 5.5 times their income to help more borrowers get on the housing ladder. Leeds Building Society is increasing the maximum amount that first-time buyers can potentially borrow as a multiple of their earnings with the launch of a new mortgage range. Aspiring homeowners with a minimum household income of £40,000 may now be able to borrow up to 5.5 times their earnings. Mortgage holders and borrowers have faced record-high repayments in recent years, as the Bank of England's base rate has been passed on by banks and building societies. According to UK Finance, 1.3 million fixed mortgage deals are set to end in 2025. Many homeowners will hope the Bank of England acts quickly to cut rates more aggressively. At the same time, savers will likely root for rates to remain at or near their current levels. Read more: How higher house prices are impacting young people's finances 10 home upgrades that don't need planning permission What are green mortgages and are they the future?Sign in to access your portfolio
Daily Mail
22-04-2025
- Business
- Daily Mail
Nationwide cuts mortgage rates and now offers best buy for home movers
Britain's biggest building society has made cuts to its mortgage rates, with the deals including a new best-buy for home movers. Nationwide has reduced its rates by up to 0.25 percentage points, including a deal for home movers with 40 per cent deposit which is now offered at 3.89 per cent. The mortgage, available on either a two or five-year fixed rate, is the cheapest rate on the market currently, though it comes with a large fee at £1,499. On this mortgage, someone buying a £250,000 home on a 25-year term would repay £783 per month. A lower-fee option is available at 3.94 per cent plus a £999 arrangement charge. After the 3.89 per cent rate, the next-cheapest rate for the same circumstances is 3.91 per cent with Yorkshire Building Society, which has a £999 fee. Last week, multiple lenders slashed their mortgage rates including Yorkshire BS, Virgin Money, HSBC and Santander. This is in response to forecasts that the Bank of England will reduce its base rate more times than previously expected this year, though experts have warned that mortgage rates do not have much further to fall. For the first time in several years, there are also rates on two-year mortgages which are cheaper than their five-year equivalents. Today, the average five-year fixed rate is 5.12 per cent and the average two-year fixed rate is 5.23 per cent. Nationwide has also reduced its two-year fixed rate for those with a 15 per cent deposit to 4.4 per cent. This deal comes with a £999 fee and is not a best buy, with similar deals available with rates as low as 4.32 per cent, or 4.17 per cent if they are willing to accept a £1,495 fee. The rates are open to both existing and new customers moving home, and will be available from 23 April. For first-time buyers, Nationwide's rates now start at 4.09 per cent. Those with a 40 per cent deposit can get a 4.09 per cent rate on a two-year fix, with a £1,499 fee, or a 4.14 per cent rate with a £999 fee. For first-time buyers with a 10 per cent deposit, Nationwide is offering a two-year fixed rate of 4.72 per cent with a £999 fee. The cheapest 10 per cent deposit deal on the market is 4.43 per cent with Yorkshire Building Society on a two-year fix, though this comes with a £1,495 fee. The same lender offers a 4.58 per cent rate with a £245 fee. Henry Jordan, of Nationwide, said: 'We know that rate is an important factor for borrowers looking to buy their first home or move onto their next. 'These latest cuts should put Nationwide firmly on the radar for first-time buyers and home movers as we continue to be one of the most competitively priced lenders in the market.' Riz Malik, director at Essex-based financial adviser R3 Wealth, added: 'Nationwide waited until after the Easter break to take the axe to their rates with new borrowers and home movers alike benefiting from the lowest fixed deals. 'Given current market movements, the next seven days may see even more cuts as the expectation for future rate cuts increases. If you have an application or an offer and the deal has not completed yet, speak to your broker.' Best mortgage rates and how to find them Mortgage rates have risen substantially over recent years, meaning that those remortgaging or buying a home face higher costs. That makes it even more important to search out the best possible rate for you and get good mortgage advice. Quick mortgage finder links with This is Money's partner L&C > Mortgage rates calculator > Find the right mortgage for you To help our readers find the best mortgage, This is Money has partnered with the UK's leading fee-free broker L&C. This is Money and L&C's mortgage calculator can let you compare deals to see which ones suit your home's value and level of deposit. You can compare fixed rate lengths, from two-year fixes, to five-year fixes and ten-year fixes. If you're ready to find your next mortgage, why not use This is Money and L&C's online Mortgage Finder. It will search 1,000's of deals from more than 90 different lenders to discover the best deal for you.
