UK ‘Mortgage Prisoners’ Are Moving To Solve Their Financial Problems
Many UK homeowners are moving because of financial reasons and choosing to live mortgage-free, whether they have enough equity to buy a smaller property or choose to live in rented accommodation. The worries of decreasing house prices, which Nationwide have reported in August to be 2.6% lower than the same time last year, and ever-increasing costs of living and maintenance mean that a significant number of homeowners are moving into rented accommodation to ease their financial stresses.
The FSA report (Mortgage Market Review) released towards the end of October 2012 states that 45% of homeowners (55% of first-time buyers) who took on a mortgage since 2005 have found themselves as ‘mortgage prisoners’. The tightening of lending restrictions after the credit crunch mean that these ‘mortgage prisoners’ will be unable to re-mortgage and will be forced to pay any increase in interest that the lenders choose to enforce. A large number of these homeowners are facing financial problems and those whose financial difficulties make them unable to keep up with their mortgage repayments will face repossession and a black mark on their credit history, unless they sell their property quickly and move into a lower value property or rented accommodation.
The FSA report has put forward new rules, which will come into effect in April 2014, which will protect those ‘mortgage prisoners’ and will ensure that the more sensible lending criteria that lenders are currently working to are built into the system to protect borrowers. This means that there are a lot of homeowners who took out a mortgage before the credit crunch, who will not be eligible for new lending in the new rules; those that can would be best to follow the lead of those that have been forced to move due to financial issues, and sell their property while they can to circumvent any future financial issues. If the current decline in house prices continues, many more ‘mortgage prisoners’ will find themselves in negative equity and will have no options open to them to avoid being repossessed.
If you find yourself needing to sell your house fast in order to alleviate financial difficulties, contacting a quick house sale company such as National Homebuyers may well be your best option. We buy your house directly, thus removing any risk offered by a complicated property chain and allowing us to offer a fast, hassle free service. We buy any house, regardless of its condition and irrespective of your circumstances or reason for selling. So if you are looking to sell property and wish to do so quickly, contact us today.