Recent reports have shown that consumers hoping to get a new mortgage or remortgage to a better deal are facing very bleak prospects, as more and more lenders take action to try and actively cut back on lending. A number of lenders have increased stringency when it comes to their lending criteria, which makes fewer people eligible for their mortgages, and some have even raised interest rates in the hope of putting the brakes on new lending.
Industry experts have recently stated that mortgage applicants are going to have to go back to the days of old when it comes to trying to secure a mortgage, which means having to hunt around for a suitable mortgage lender and then plead your case in order to try and get the finance that you need. Over recent years people have become more used to easy credit and lenders clamouring to try and give them finance, but as a result of the global credit crunch this has become a thing of the past.
It has become increasingly important for those looking to find a mortgage, whether a new one or by way of refinancing, to act quickly so that suitable mortgages do not disappear altogether. Some lenders have admitted to the fact that they have raised rates and increased stringency in order to cut back on mortgage lending to new customers. The Nationwide has recently raised the interest rate on its tracker mortgage, and admitted that it was actively looking to reduce new lending.
Officials from the building society had said that they are simply responding to market conditions, and one official said that it now has to focus on quality rather than quantity. One official from Nationwide said: 'Nationwide sympathises with anyone who is concerned about the availability of affordable mortgages. We continue to offer our customers a wide range of fixed and variable rate mortgages up to 95% loan to value with, as always, a focus on prudent and responsible lending rather than volume.'
All evidence points to the fact that the days of being able to get a mortgage easily have long gone, and consumers must now cope with an increased chance of rejection, higher deposit requirements, and higher interest rates.
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