Loan Applications See Increase
The latest monthly figures on the number of new home owner loan applications being submitted in the UK, are causing experts to start suggesting that the country is steadily returning to a stable home owner loan and mortgage market.
The total number of loan application being made throughout the month of March had increased by 11.6 per cent above the figures for the previous month and 20 per cent higher than at the same time twelve months ago, according to the latest statistics from the National Mortgage Index, compiled by the Mortgage Advice Bureau and Coreco Group.
With the probability of an increase in interest rates from the Bank of England at some point later this year, it is probably not surprising to learn that around 80 per cent of all home owner loan applications were for fixed rate loan deals, similar figures to February.
However, the average loan to value ratio on home owner loans, which has been slowly increasing over the course of recent months, actually saw a slight reduction in March to 69.9 per cent, from 71.4 in the previous month.
The number of remortgage loan applications saw a slight decrease from the February figure, although this sector is still almost one third higher than it was twelve months ago, as borrowers look to switch their standard variable rate loan to a fixed rate deal before rates do increase.
Brian Murphy of the Mortgage Advice Bureau said “March figures are encouraging and continue the positive start to the year with another month on month increase in borrower activity.”
“This view is supported by several lenders increasing their risk appetite, albeit cautiously by offering slightly higher loan to value lending with the introduction of 90 per cent and 95 per cent loan to value.”
