With more lenders increasing their Standard Variable Rates over the last week, the Sunday Times looked at whether it is now time for borrowers to move their mortgage. As a general rule experts suggested that homeowners with more than 20% equity and on a Standard Variable Rate above 3.5% should consider switching now. Economists expect rates to double to 1% by the end of the year, rising to 2.50% by 2011, so the coming weeks appear to be a good time to snap up a competitive deal, especially following a new stream of low rates launched last week by the likes of First Direct and the Leeds Building Society. Applying for a mortgage may appear to be a straightforward process, said The Times, but recent reports suggest that details of millions of mortgages, bank accounts and credit cards opened before 2000 do not appear on credit reports, as many banks and building societies do not have permission from customers to pass their details on to credit reference agencies. This can cause severe problems for anyone looking to apply for a mortgage or loan as lenders base their decision on electronic rather than manual scoring, so any information omitted from a credit report could lead to an application being rejected. Elsewhere, the Mail on Sunday looked at the growing trend of lenders offering multiple versions of key products which can differ greatly from the attractive rates advertised. Halifax for example offers several variations on headline grabbing rates depending on an applicant’s level of equity and whether they are an existing customer. Experts therefore highlighted the importance of shopping around and checking the small print of a deal before applying.
What the papers say- 6th and 7th February 2010