Published 13th June 2022
The Bank of England interest rate is at its highest level for 13 years with the potential for another increase on the horizon. Hear from Oliver Meddick, Chief Executive Officer at Home Legal Direct, with his take on current trends in the marketplace together with his conveyancing advice on how to help weather the storm...
Who is feeling the effects of the interest rate increases?
For those already with a mortgage, it is homeowners with a variable or tracker mortgage who are already feeling the effects as lenders adjust their rates in line with the increases. Those on fixed rates are more protected for now but that will depend on how long it is until the fixed term ends, creating the need to transfer onto a new mortgage product.
How is this affecting mortgage products?
Homeowners are naturally looking for better deals and those looking to buy a new home are keen to lock in mortgage offers before rates increase again. This is causing a high volume of applications from homebuyers and also from those looking to remortgage. This in turn is putting more pressure onto lenders. What we are seeing is lenders reacting by amending or withdrawing mortgage products at short notice. This leaves buyers and the advisers who are searching for products on their behalf, with a moving landscape and uncertainty on the costings to purchase their next property.
Is there a shift towards certain mortgage products?
We are also seeing a shift towards homeowners choosing longer-term fixed rate mortgages as they look for more stability. Five-year terms are seeing an increase in uptake, but their terms can vary. Speaking to a mortgage advisor and researching the best deals is particularly key at the moment. Mortgage comparison sites such as Money Saving Expert are also a great place to start. Their mortgage rate calculator will help you stay in touch with the current products available.
How are conveyancing services being affected?
At Home Legal Direct, we are still seeing a high demand for our conveyancing services. This encompasses those wishing to sell, those wishing to buy, and those looking to remortgage. The shift we are seeing is the need for quick and efficient transactions as people look to move forward quickly to lock in mortgage rates in case there are future increases or lenders withdraw a product.
Ways to help move the conveyancing process forward
The hope is that once a period of calm has returned to the Bank of England, lenders will increase their products and the stability of these. In the meantime, for any property or remortgage transaction, our advice is to get all the parts of the jigsaw in place to help move forward efficiently. No one wants delays in a chain and incomplete paperwork can really impact this. Your conveyancer is key in making a smooth transaction, but consumers also have their role to play to avoid delays along the way. Getting forms completed in good time, finding documentation that is required such as bank statements and ID information is all key in speeding up the process.
Use the Home Legal Direct online quote
Using Home Legal Direct’s online estimate tool will provide you with a free quote in seconds. We can facilitate a range of conveyancing and survey services specific to your requirements and give you the information you need quickly and efficiently. Our quotes are competitive and come with a no move, no legal fee guarantee. Or speak to a member of the Home Legal Direct team who will be happy to help.