FAQs: Your Mortgage Questions Answered
Written By David Jackson, Prestige Private Finance Managing Director
We have partnered up with David Jackson, Director of Prestige Private Finance, to answer your FAQs around mortgages and what to expect in 2023. For more information on how we can help you with your mortgage, please get in contact with us.
Is it harder to get a mortgage at the moment?
The cost-of-living crisis means the banks are having to factor in increased costs to buyers’ outgoings. This ultimately puts more strain on the affordability assessments used by the banks. So, while in principle banks can still consider the same income, the actual amount they will lend could be impacted by the cost-of-living crisis and the banks individual stress tests.
Speaking to a broker is the best way to find out which banks stress tests are best suited to you and your individual circumstances.
How do you expect mortgage rates to change in 2023? Are they likely to go down?
Crystal ball time! The fixed rates are most likely to fall, especially at the start of 2023 when the banks reassess their offerings and look to set their yearly lending targets. Mortgage rates have already started to reduce. The cost to the banks of sourcing the money for mortgages has come down. It's just taking its time to filter its way through to the consumer.
So yes, I do expect the fixed rates to reduce even further, but by how much and when will be determined by inflation data. Inflation is expected to come down, but by how much and when we don’t know.
Is it a good time to fix a mortgage?
The answer to this question is entirely personal preference, affordability, and attitude to risk. Fixed rates provide certainty and peace of mind; however, on the flipside, you could end up taking a fixed rate product at its peak, which could cost you more than a variable rate long term.
How do you find the best deal?
Speak to a mortgage broker that offers a personal service, with a wide reach across the mortgage market. The reason brokers exist is because the banks not only offer different rates, but also differ greatly in terms of how they look at income, types of property and how they assess affordability.
A broker will advise you on the most suitable options based on your requirements. A good broker will not only source the best deal but will also arrange the mortgage and deal with the process personally giving you peace of mind that you’ve got the best terms possible for YOU.