UK Property Market Trends Analysis
February 4, 2009 by admin
Filed under Mortgage Articles
That can be a frightening prospect for any potential buyer, but for a young couple that are considering purchasing their first home. It may be an incredibly daunting prospect to consider being involved in such a large transaction.
Last year the number of people who owned their own home in Britain went down by 84,000. This was caused mostly by increased UK home prices that have risen at an alarming rate since the new century began.
The rise in house prices has far outweighed the rise in annual salaries over the last 20 years. Many homeowners have found themselves in a situation where they simply can no longer maintain their mortgage payments on a home they purchased twenty years ago.
In the same period, the rental market for houses has boomed as many couples find that in the short term, they can pay less per month for rent than they would have to pay for a mortgage.
A couple of other advantages are that you are not responsible for major repairs, which can add up to a considerable amount of money over time. Therefore, it would seem as if renting a property at the moment is a far more viable proposition than purchasing your own home.
However, there are other considerations, to keep in mind when comparing purchasing and renting on a long-term basis.
Lenders have always been less kind to tenants than homeowners, when it comes to handing out loans, especially mortgages. Finding all kinds of loans is much easier if you already have a mortgage, as it is possible to use any equity in your home as security against a loan.
Tenants pay rent for which they never see return, homeowners on the other hand, eventually will own the house, free and clear. This will give them a huge cash amount should they choose to sell. Alternatively, they will have no rent to pay for the rest of their lives giving them more available cash every month.
The recent near disappearance of the hundred percent mortgage, has its downside in that it may be more difficult for new home buyers to get on the ladder. Nevertheless, on the plus side, it means that once the new homeowner has their mortgage their home is far less liable to be repossessed. This is because it is also less liable to slip into negative equity, meaning it is worth less than the owner paid for it.
Another advantage of this down market at the moment is houses are now actually cheaper than they were a year ago. Enabling those who have saved a deposit to find a home at a lower price than they would have paid last year.
Once the market moves upwards again, as it always does, the new homeowner will be in a much better position. Having paid less for their house, and also owning a bigger percentage of the equity in the property.
There are advantages at the moment to renting over buying but they should be carefully weighed against the much more rewarding long-term benefits of home ownership.
Remortgage – Encash the Opportunity
February 3, 2009 by admin
Filed under Mortgage Articles
When you take a remortgage you get a chance to pay off your current mortgage and still are left with some money to meet your needs and it comes after you pledge some security. Remortgage is a secured process and in simple words it’s a process of mortgaging your current mortgage again.
The money released by remortgage can be used to fulfill any of your personal needs. You can buy a car or finance your children to pursue higher education. If you want to start a new business venture you can do that. You may be having serious credit problems due to some unpaid previous debts and through remortgage you will get a way to pay them all. Any other personal need can also be satisfied with the money as the lender is interested only in the security placed by you not in what are you doing with the money. It’s all yours.
Some reasons may be cited to answer why one should go for remortgage. Remortgage will give you a chance to get a loan at lower interest rate than what you are paying now. By reducing your monthly outgoing money in repayment you will save a lot in the long run. You may be looking for more capital than what you are getting through your current one and you will get one. Repayment period will also be expanded in the process of remortgage.
Any one living in UK and above 18 can apply for remortgage. Bad credit holders are also eligible but they have to do a little shop around to get a lender willing to give remortgage at relevant price. Online is the best place to search for a lender to get remortgage. But always keep in mind remortgage is a secured loan so be regular in your repayment term. So avail better opportunities with remortgage.
Summary
Remortgage as is self suggestive involves mortgaging the exiting mortgage at fresh terms and conditions and according to the current rates in the market. This is secured kind of loan as obvious. This has many advantages in form of decreased interest rate and stretched repayment tenure.
Cheap Remortgage U.k: the Best a Loaning Market Can Offer
January 10, 2009 by admin
Filed under Mortgage Articles
What you do in remortgage is exchange your loan type with the same property with a new lender or the existing one to get more money owing to the increased market value of your property. You get a fair option to reduce your expenses by again selecting the cheaper loan terms. This will help managing your budget with reduced monthly expenses and putting your money to different use.
Cheap remortgage UK: Process
Remortage is just shifting of the lenders or the loan type so that it does not consume much time. Most document verification regarding your collateral is already been done earlier so you do not need to prove their authenticity again. Most lenders do provide online application forms which help save your commuting efforts. Your next step is to decide the amount that you want your remortgage for and the term you require to stretch it over. Your remortgage may come with a more competitive rate than your current mortgage. But some lender does charge on the early repayment of the money and you should better have a complete idea of the whole thing before switching over to the next lender.
Forms concerning remortgage are verified within 24 hrs. Remortage is secured in nature for any lender and so your credit rating is not paid such an attention. Although a good rating is always facilitated by some of the loan flexibilities.
Remortage is solution to many of general problems. The best thing is that it generates amount with the already used property and the money is all yours. The money so obtained can be put to any use like improvements, debt consolidations etc. It helps you to keep up with the market and know the value of your collaterals. So plan your vacation may be your old house can arrange you a holiday.
Nationwide Building Society Responds to Expanding Customer Base with Implementation of Nomis Solutions’ Customer-Centric Pricing Optimization Technology
December 10, 2008 by admin
Filed under Mortgage News
San Bruno, CA (PRWEB) December 10, 2008 — Nomis Solutions, the leading provider of best-in-class Pricing and Profitability Management for financial services companies, announced today that Nationwide Building Society has selected the Nomis Price Optimizer™ to better tailor the pricing practices of its Personal Loans Business to its customers. The Nomis Price Optimizer allows Nationwide to optimally extend credit to more consumers, while accounting for various corporate requirements and market conditions. Nomis Price Optimizer also enhances Nationwide’s ability to meet regulatory requirements by providing more visibility and the ability to audit its pricing decisions.
News ImageNationwide is the largest member-owned building society in the United Kingdom, with 14 million members and assets of over £186 billion. The Nomis Price Optimizer allows Nationwide to better serve its customers, augment its previously tiered approach to lending, and offer rates that are tailored to the market, account for risk, and best suited to the customer. Nationwide’s borrowers are assured that the pricing process is efficient, consistent, and transparent to meet regulatory requirements.
We’ve partnered with Nomis Solutions to use a more customer-centric and tailored approach to pricing that will enable us to price our unsecured loans business appropriately and prudently
The Nomis Price Optimizer enables us to understand the impact of pricing on customer response and use that insight to make smarter pricing decisions in this difficult environment.
Nationwide understands the power of pricing and how it can be used strategically to expand its customer base in the most intelligent and customer-centric way
Contrary to many institutions that are responding by providing consumers with fewer options, Nationwide’s adoption of the Nomis Price Optimizer positions the company to better manage through the difficult financial market and optimally serve its customers’ needs.
“We’ve partnered with Nomis Solutions to use a more customer-centric and tailored approach to pricing that will enable us to price our unsecured loans business appropriately and prudently,” said Simon Beresford, Head of Consumer Lending for Nationwide Trust. “The Nomis Price Optimizer enables us to understand the impact of pricing on customer response and use that insight to make smarter pricing decisions in this difficult environment.”
The Nomis Price Optimizer provides Nationwide with a strong compliance framework and a set of pricing best-practices and processes that make it easier to demonstrate adherence to regulatory and corporate rules and guidelines. Nationwide’s implementation of the Nomis Price Optimizer provides the pricing team the ability to track, store and provide visibility into all past pricing decisions, as well as the rationale for those decisions.
“Nationwide understands the power of pricing and how it can be used strategically to expand its customer base in the most intelligent and customer-centric way,” said Frank Rohde, Chief Marketing Officer of Nomis Solutions and Managing Director of the company’s European operations. “Contrary to many institutions that are responding by providing consumers with fewer options, Nationwide’s adoption of the Nomis Price Optimizer positions the company to better manage through the difficult financial market and optimally serve its customers’ needs.”
Nationwide Building Society
Nationwide is the world’s largest building society with over 14 million members and assets of over £186 billion. Nationwide has mutual (as opposed to Public Limited Company) status, which means that it is owned by its members and is run day-to-day by an executive management team overseen by an elected board of directors.
Nationwide offers a broad range of retail financial services including mortgages, savings, current accounts, life assurance and investment products, personal loans and household insurance. The Society is the UK’s third largest mortgage lender and the second largest savings provider. Nationwide’s members can manage their finances through over 900 retail outlets, by telephone, internet and post. The Society has around 19,000 employees. Nationwide’s head office is in Swindon with administration centres based in Northampton and Bournemouth.
About Nomis Solutions
Nomis Solutions enables best-in-class Pricing and Profitability Management for financial services companies. Through a combination of advanced analytics, innovative technology, and tailored business processes, the Pricing and Profitability ManagementTM Suite delivers quick time-to-benefit, and improves financial and operational performance throughout the customer acquisition and portfolio management processes.
Select customers include Abbey, AmeriCredit, Bank of Montreal, Chrysler Financial, HBOS plc, Nationwide, and Royal Bank of Canada. Visit www.nomissolutions.com or contact us at info@nomissolutions.com or +44 0207-031-8273.
Nomis Solutions, the Nomis Price OptimizerTM, Nomis Offer OptimizerTM, the Customer Portfolio OptimizerTM and the Nomis Pricing and Profitability ManagementTM Suite are trademarks or registered trademarks of Nomis Solutions, in the United States and in other countries. Other product and company names herein may be the trademarks of their respective owners.
Secured loan or remortgage?
November 20, 2008 by admin
Filed under Mortgage Advice
If you have enough equity in your home, you may be able to turn some of it into cash with a secured loan or remortgage. In case you’re not familiar with the term ‘equity’…
Equity equals
the value of a property minus
the amount owed on it (mortgage / secured loans)
So equity is the portion of the home that you owe nothing on. Let’s say Mr Evans has a £50,000 mortgage on his £150,000 house. On a repayment mortgage, that means he has £100,000 of equity – basically, he owns 2/3 of the house and is (gradually) buying the other 1/3 from his mortgage provider.
What are secured loans and remortgages?
Secured loans and remortgages are two ways people can turn their equity into cash.
People can also remortgage:
· to get a better mortgage deal,
· to speed up / slow down the rate at which they’re repaying their mortgage, or
· because they’ve reached the end of their mortgage term.
… but in this article we’re looking at remortgages designed to free up equity.
Secured loans and remortgages both involve borrowing money from a lender and securing it against your property. On the plus side, this means you’ll probably be offered a much lower interest rate than you’d be offered on an unsecured loan.
However, your home could be at risk if you don’t keep up with your repayments, as the reason why lenders can offer you a lower rate is because they’re taking a lesser risk with their money – they’d have the option of repossessing your home if there was no other way you could pay them back.
Secured loans and remortgages – what’s the difference?
In our example, Mr Evans could free up a reasonable amount of his equity (for home improvements, debt consolidation, etc.) with either a remortgage or a secured loan. Let’s say he wants to take out £50,000.
Remortgages
A remortgage would be a replacement for his mortgage. It’s a new, larger mortgage – big enough to replace his current mortgage and free up some of his equity, turning it into cash.
- He could take out a £100,000 mortgage, so he could pay off his £50,000 mortgage and have £50,000 left over.
- He’d then need to repay that £100,000 mortgage. Compared with his old £50,000 mortgage, repaying this £100,000 mortgage would either cost him more per month, take longer, or both.
Secured loans
A secured loan would be in addition to his mortgage. It’s a loan – a bit like an unsecured loan, but secured against the equity in his property.
- He could take out a £50,000 secured loan.
- He’d then need to keep repaying his £50,000 mortgage (exactly as he used to) and start repaying that £50,000 secured loan.
Secured loans and remortgages – what’s the risk?
Be aware that secured loans and remortgages have their ‘cons’ as well as their ‘pros’.
First of all, as mentioned earlier, you’re potentially putting your property at risk if you can’t keep up with the repayments.
Plus, property prices are falling at the moment. Mr Evans’ £150,000 house could be worth £140,000 three years from now, or £130,000 – or £170,000! There are lots of different predictions, but no-one knows for sure.
So the more equity he takes out, the greater his chances of ending up in negative equity (owing more on the house than it’s actually worth) if the value of his house drops further.
Falling prices are one reason lenders are more cautious about giving out mortgages today (especially mortgages that are worth nearly as much as the property). Like any secured debt, a mortgage needs to be secured against something that’s worth at least as much the mortgage – otherwise, it’s not really ‘secured’!
Secured loans and remortgages – the right way forward?
For some people, a secured loan or remortgage can be a great way to get their hands on some ‘liquid’ cash. For others, it might be a bad idea – if they don’t have much equity in their home, for example, or if they’re not sure they’ll be able to afford the repayments.
Even if you find a lender who’s prepared to give you a secured loan or remortgage, that doesn’t necessarily mean it’s a good idea. Before you commit yourself to anything, you should discuss your options with an expert who understands the secured loan and remortgage markets, and can help you decide which – if either – of the two is the right one for you.