What can you expect when it comes to a First time buyer mortgage and purchasing your first home in 2019?
We have had some conversations with account managers over the last week or two on their plans for 2019 and whether they are expecting any problems with Brexit or not.
Risk/Underwriting
When the recession hit in 2007/2008 the biggest issue in lending was a shortage of money for mortgages. This meant that only the very lowest risk of customer were receiving Mortgage offers. That meant, no bad credit, stable employment and large deposits were needed to get a Mortgage which in turn meant the housing market slowed considerably.
As such, whilst those with very large deposits, home movers with equity and the very wealthy or those with perfect credit could get a mortgage, for the large majority of people including those looking for a First time buyer mortgage, options were very limited.
That differs from the climate at the minute. Mortgage lenders appear to want to lend out money and have plenty to lend out. There appears to be no shortage of buyers either so the market is quite buoyant.
From our perspective, whilst we are only a small Manchester Mortgage Brokers so hardly indicative of the whole market, we have been busy right up until mid December were as normally we would see business levels fall off around mid November and are still receiving enquiries for January and beyond.
Lending Targets
Whilst lenders will not tell me what they are looking to lend out in the year, they have confirmed that their targets are more or less in line with 2018 and in some cases an increase on last year.
Brexit
The dreaded B word. This is the big question for 2019. Nobody seems to know what it will do to the market. Most lenders seem to be hoping it is just business as usual and will just pass without too much of an effect but I think most are expecting a dip in business in the run up to Brexit which is mainly down to uncertainty.
Outlook for 2019 in the Mortgage world?
A few years ago there was an EU directive in the insurance industry meaning insurers could not alter the rates between men and women. The industry expected there to be a knock on effect after the change came in to effect. In reality what happened was there was a large up turn in the run up to changes, a large downturn in the months following and then business carried on as normal.
Assuming there is still plenty of funding in the market for mortgages, it is hard to see there being any long term impact as there is still a shortage of homes in this country meaning demand will still outstrip supply.
Personally, I think 2019 will be business as usual with the exception of a blip in March/April 2019.
Whatever your circumstances a mortgage review is always a good idea and if you are worried about 2019 and the next couple of years and how this will impact your mortgage payments now is a good a time as any to shop around and review your options.
For those just stepping onto the home owner ladder so to speak and purchasing their first home in the current environment of uncertainty over Brexit at Mortgage Success we will guide you through what can be a daunting process and find the best first time buyer deal for your needs and circumstances. So again it pays to shop around and use a whole of market broker such as ourselves.
For a review of your mortgage options drop us an email or simply request a call back.