Summary
All of a sudden, mortgage lenders love mortgages over £500,000. Great if you can afford them.
Mortgages. The return of the Mega-Mortgage.
Author: Michael Challiner
With the housing market is now showing marked signs of recovery,
- Home Mortgage Loans
- More people are paying off their mortgages early. How do they do it? This article explains some ways.
- Foreign Currency Mortgages. What are they and what are the risks?
- Foreign currency mortgages could save you a lot of money but the risks are high. This article explains.
- Mortgages. Regulations tighten on interest only mortgages.
- Interest only mortgages have been very popular, especially amongst first time buyers. But the FSA has now introduced restrictions. This article explains.
- Mortgages. Exit fees to be capped.
- After years of lenders having a free hand to increase exit charges, the FSA steps in to restore fairness for consumers. This article explains.
- Mortgages. Short term advice
- There are some new lower rate “lifetime” home loans coming onto the market. How do they fare against the even lower rate “shop around” options?
- HIP's – the full story
- Ready, steady, go! With just three months to sell your home using the forthcoming and compulsory information pack, you need to get your act together. Here we face the facts.
Previously, prospective borrowers for these mega mortgages have experienced a mixed reception from the lenders – sometimes the lenders would provide the facility but viewed them as higher risk. For that reason lenders typically charged a premium rate of interest. But no longer. The tide has turned.
Mega mortgages have well and truly joined the mainstream and lenders are now competing hard for the business. Instead of facing a premium, borrowers are being offered around a quarter of a percent less than comparable deals for more normal sized mortgages. This is because lenders are increasingly basing their lending decisions on the borrowers ability to afford the mortgage with lesser emphasis being placed on the security provided by the property. It also helps that interest rates remain low.
If you're a potential mega mortgage borrower, you'll find that the banks will generally be the most welcoming. Compared to building societies and other mortgage lenders, banks tend to set higher lending limits. Some smaller lenders still set a cap at £500,000 whilst others restrict the amount they'll lend against an individual property. But perhaps the best way of finding a really competitive mega mortgage is to go through a specialist mortgage broker. In the current market, any broker worth their salt will be able to source a great deal on six and seven figure mortgages.
For example, the Halifax will lend up to 90% on a 4.49% fixed rate for a two years on mortgages up to £2 million. And the arrangement fee is just £499. If you've got a larger deposit, at least 25%, then there are several other deals around at 3.99% - again for a two year fix usually with a fee of just a quarter of a percent.
Latest House Market Facts
In March, the average achieved sales price was 94% of the asking price.
The average number of viewings to sales was 11.
During March house prices in England and Wales rose by 0.5% driven by buoyant London market. London prices grew by 1.1%.
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