While these are unprecedented times, it is essential people try to retain as much normality in their life as possible. While it is crucial people follow social distancing guidelines and keep themselves safe, people will inevitably try to do the things they usually do. Also, if people had plans in place before the lockdown, likely, they will still want to follow up on these ambitions as soon as possible.
Therefore, anyone who has been planning on entering the property market is likely to still have this plan. Any prospective buyer looking to make a move soon should be aware that current market conditions may be more challenging for them. Hopefully, these new conditions will only be present for a short while, and there are many reasons why companies are operating differently.
The market is adjusting to the current situation
The headline news about the mortgage market still operating is positive, but it is important to note many leading lenders are looking for more substantial deposits. This will impact some buyers because the size of the deposit is a crucial factor in buying a property. With significant lenders like Barclays and Halifax requesting a 40% deposit, some buyers will decide to wait a bit longer before applying for a mortgage.
However, this is unlikely to be a long-term issue, and it has nothing to do with liquidity issues in the market. It is understandable the mortgage sector, like many industries, has a staffing issue right now. While employees can work from home, it is inevitable there will be a drop-off in services a firm can offer.
Lenders looking to offer support as many clients as they can
It is also vital to state many lenders will be busy dealing with clients looking to arrange a mortgage holiday or who are keen to remortgage. With heightened demand in this area of their business, many lenders are stretched in what they can provide. Therefore, some lenders have decided to increase the criteria for mortgage deposits, in the hope of allowing them to better manage all aspects of their business.
Any buyer who is in a position of providing this size of deposit will find they have a vast range of mortgages to choose from. The reduction in increase rates and commercial pressures facing companies ensure that lenders will welcome any prospective buyer who can offer a larger deposit.
Sara Bennison, chief marketing officer at Nationwide, said: “We need to maintain the levels of service expected of us in the face of an extremely high number of enquiries about existing mortgages and ongoing applications. We continue to monitor for any updates to government advice and, in this ever-evolving situation, we ask members and brokers to bear with us and thank them for their patience.”
Anyone who is considering buying a home or who is looking for guidance on mortgage matters should be aware the market is operating, and help is available. Each person and household have their priorities at this current time. For some parties, the present circumstances will only reinforce their need and desire to step onto the property ladder.