Changes to pension rules were the main focus of this weekend’s financial press, following the recent Budget announcement that people will be allowed to withdraw lump sums from their pension pot to invest as they wish. Experts in the Financial Times and Sunday Times warned that those who plan to use the money to invest in property should think carefully about the tax implications as well as the net rental income that will be generated after loan and landlord costs.
The Sunday Telegraph reported that the new pension rules could provide a lifeline for borrowers with interest only mortgages who are expecting a shortfall at the end of their mortgage term. There is hope that lenders will allow affected homeowners to extend their loan term until they can access the capital, thereby allowing them to remain in their homes, although it is too early to tell whether lenders will make this change to their criteria.
In other news, The Telegraph looked at the recent findings of a survey by the Mortgage Advice Bureau, which revealed that 96% of homebuyers applied for a fixed rate mortgage in February, despite an increase in rates recently. The Mail on Sunday looked at those who would be wise not to remortgage at this point, including borrowers on very low tracker rates or with hefty Early Repayment Charges, and those with a recent changes in their circumstances.