Online Stock Trading - Self-certification Mortgages and Mortgage Refinancing Tips
Self-certification mortgages are disappearing but mortgage refinancing is on the increase
Online stock trading can seriously modify your wealth! So if you are fortunate enough to have increased your wealth rather than the opposite you may be looking to invest in property. If you are a self-employed stock trader you may require a self-certification mortgage.
According to reports, self-certification mortgages, i.e. where the buyer makes up his own accounts, and presents them to the mortgage provider have almost disappeared from the UK market. Banks now no longer want to take risks.
There are just two providers for self-certification mortgages left – the Nationwide (via The Mortgage Works), and Britannia (via Platform).
Self-certification mortgages were popular with the self-employed whose revenues are variable and not always verifiable. They were also useful for employed people who earned extra income.
In self-certification mortgages borrowers declare their earnings with no need for accounts, i.e. a nod and a wink and the bank takes a risk and if you get into trouble they boot you out and repossess your home - foreclosure if you are in the USA.
Banks now no longer like these mortgages, as some borrowers used to inflate their income (the scoundrels!) to get larger loans.
David Hollingworth of London & Country Mortgages, said “The self-employed will certainly have more hoops to jump through in order to secure a new mortgage.”
Those banks that continue to offer self-certification loans have high hurdles and high mortgage ratesm such as only lending 65% of the property value. Platform lends 75% loan-to-value but 2 year fixed rates start at 7.19% and there is a signing on fee £1,995.
Self-employed borrowers can still take out non self-certification mortgages but they need to have up to 3 years’ of accounts. Large deposits also help.
The reluctance of banks to provide self-certification mortgages reflects the general trend away from specialist lending.
His advice is to compare mortgage rates online before signing any loan agreements to ensure that you get the best mortgage rates.
“Near prime” mortgages are also proving more difficult to find.
Restrictions are also being introduced on buy-to-let lending.
If you have been lucky or skilful and your stock trading has been successful, you may want to consider remortgage deals , i.e. renegotiating the terms of your mortgage.
Mortgage refinancing however, in the USA at least, is on the increase. Although home sales are still difficult, the aggressive moves by the federal government to revive the economy led to a boom in mortgage refinancing that has continued into 2009.
Chuck Tonkin, from the Mortgage Investors Group in Knoxville, estimated that mortgage refinancing volume for his company is up 400 to 500% this month over January 2008, and he is confident that he will see an even bigger number in February.
Tonkin said “many, many people are working until 10 every night just to keep it going,” and said that this is probably happening at other mortgage refinacne companies too.
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