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Halifax and MortgagesAnnounced on Wednesday, Halifax has stated they are going to be changing the price of their mortgages. They are one of the largest lenders of mortgages in UK. During the credit crunch many banks have needed to change their lending policies to save their banks. Now Halifax, still in a bit of fallout from the credit crisis, is deciding to make another change. The bank is going to cut the cost on some of their fixed rate loans. The only problem is they are going to increase the fixed rates for those who don’t have a deposit. In other words if you can’t come up with at least 10 percent down, your loan is going to cost you more because you are seen as a risk. For those who have a larger deposit they will get to see the benefits of the cut costs on the mortgages being offered by Halifax. While the news was released on Wednesday the actual changes did not start until today. Now the mortgage brokers have a little more they can try to do, to get UK residents a better loan. This change is one of many that has come from the UK banks and building societies. The changes are to help the lenders who are having liquidity issues solve them. They are also trying to get less risky consumers to take their loans that are on the market. There have been literally thousands of mortgage products removed from the industry in the last several months to try and get a better handle on the situation. Lenders that had the cheap fixed rate deals have gone on to create higher interest rate products. They have also changed the way they are willing to lend money. They are no longer allowing such high risk applications to be approved. Since this instalment of mortgages there have been at least 20,000 plus loans rejected due to the risk of the applicant. You shouldn’t worry though. While some lenders are increasing the price of their products or simple removing them, other banks and lenders are recognizing an opportunity. Those who want to take advantage of the crisis are still offering the lower rate loans in order to get the consumers who are in need of loans. They still have the tight lending policy changes, but they are offering a more affordable option rather than hiking it up to where the consumer definitely can’t afford the loan. There are lenders to be cautious of. Barclay, Woolwich, and Nationwide have increased their fixed rates by .3 percent. Bradford and Bingley have increased their rates by .55 percent. Alliance and Leicester is one that is not increasing their mortgage rates. In fact they have lowered rates for consumers who can afford to borrow with a deposit of 25 percent or more. The Royal Bank of Scotland is offering rate cuts of .30 percent off the new mortgages. The key to the mortgage industry for UK consumers is to make sure you look around for the deals before signing on the dotted line. Back To Financial News June 2008 100 Percent Mortgages |
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