Background Information

The mortgage market is currently tough for homeowners – and many borrowers who found a great remortgage a couple of years ago are now struggling to find a similar one today.

Before the credit crisis, the UK remortgage market was very competitive - many lenders were eager to lend money, and used favourable interest rates and discount deals to attract new customers.

Property prices were booming, and had been for the past ten years. Lenders also offered mortgages with high Loan to Value ratios (LTV), known as 100% mortgages, giving first time buyers with no deposit saved the opportunity to get on the property ladder. This resulted in many homeowners having little or no equity in their homes.

When the credit crunch hit, lenders were forced to pull many of their deals, including all of their 100% mortgages, and are now less willing to take risks when considering applicants.

The interest rates which have been steadily rising over recent years have yet to decrease. With the cost of borrowing being so high, and the increased restrictions on the availability of credit, many homeowners who wish to remortgage are now finding it difficult to find a low-cost deal and face a dramatic increase in their mortgage repayments.

However, lenders are stilling looking for new customers and money-saving remortgages are still available – it’s simply a case of researching the mortgage market thoroughly and choosing the right deal.