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Mortgage affordability in a post-lockdown world

Get a great rate on your home or commercial mortgage

Back in March, the Bank of England slashed the Bank Rate to an all-time low of 0.1% in a bid to help alleviate some of the severe economic pressure caused by the pandemic. As the interest rate cut fed through to mortgage rates, lenders pulled some products from the market.

Many of the products withdrawn were high loan-to-value (LTV) deals (i.e. those requiring a smaller deposit) as lenders were concerned that a potential drop in house prices could push high LTV borrowers into negative equity.

Lenders remain cautious

When the property market reopened for business in May, several lenders relaunched higher LTV deals and products aimed specifically at firsttime buyers, such as Help to Buy loans. However, in early June, many high LTV products were withdrawn again, due to high demand.

Mortgage affordability in a post-lockdown world 

With the property market in the early stages of recovery, it’s worth being proactive and maximizing your chances of mortgage approval. Follow these tips to help improve your chances:

Save as much as you can – many of us are spending a great deal less than usual. Having a higher deposit will increase your chances of mortgage success

– Clear your debt – clearing as much debt as possible, as well as closing any unused accounts, will increase lenders’ confidence in your ability to repay your mortgage

– Understand your credit score – the better your credit rating, the higher the likelihood you’ll be accepted for the most competitive mortgage deals

– Self-employed? Keep excellent records – having excellent records of your earnings over the past two or three years (depending on the lender) can really improve your chances

– Consult the experts – we can help you find a mortgage deal that gives you the highest chance of a successful application and suits your individual circumstances.