Where Are The Best Interest Rates
To day we are certainly seeing some of the best interest rates ever seen in the history of motgage lending. Back in 1975 there was around 5,000 different interest rates available in the UK mortgage market and just before the credit crunch four year ago there were over 18,000 different interest rates to choose from. Four years on from the credit crunch we now have around 4,054 different interest rates available to borrowers. This means we have less mortgage rates today than we had 36 years ago when the mortgage market was much smaller.
Whilst we have some of the best interest rates around in many decades it has become harder to borrow money for a mortgage. First-time buyers are struggling to find ten to fifteen percent deposits just to by their first home and the average age of a first-time buyer is 35 years.
The best interest rates today are for borrowers that have more than 25% equity in their properties, no adverse credit history and a permanent full-time job. Haven’t times changed from four years ago?
Best Interest Rates Are For borrowers
That Don’t Present A Risk To The Lenders
Today in the UK you can no longer borrow more than 95% of the value of the property. To obtain a 95% mortgage you will need to have the cleanest credit record and the mortgage lender will not lend any more than 4.5 times your annual income. Four years ago it was possible to borrow up to 125% and obtain finance for your mortgage based on up to seven times your annual income. Today this is impossible as the lending criteria has changed and the mortgage lenders only want to lend to borrowers that present them with no risk.
Sub-prime Lenders Never offered Best Interest Rates
Four years ago we had approximately 35 lenders for the sub-prime mortgage market, whereas today there are only two lenders left. Some of the original sub-prime lenders have left the country while others have stopped lending in this market.
What difference a year can make!
If you have any thoughts about the best Interest Rates around then let us know….