Credit crunch still hitting mortgages three years on

Three years into the credit crunch, and it’s still very difficult to get a mortgage. A big deposit is the key to a cheap deal.

As we move into the 4th year of the credit crunch Ray Boulger of leading independent mortgage adviser John Charcol reveals some of the ongoing difficulties for the mortgage market.

“Before the credit crunch, getting money from some mortgage lenders was nearly as easy as asking a resident of the North Pole to lend you some ice. Certain lenders fell over themselves to meet lending targets by offering loss leading rates – just ask borrowers who, probably after getting advice from a good independent mortgage broker, are still paying a rate that starts with zero. We now find ourselves in completely the opposite place. It’s like asking the same people to lend you some sand.

“Borrowers are being rejected at record rates, often for very minor indiscretions like being late with a credit card payment, and one major lender admits privately to rejecting 90% of the applications it receives for 90% LTV mortgages.”

For borrowers it is difficult to know where to turn. Now more than ever, you need to do your homework and research the entire mortgage market thoroughly – not just to secure a good deal, but sometimes get any mortgage offer at all! In this environment a good, independent mortgage broker is worth their weight in gold.

Ray Boulger continues, “The mortgage market has changed radically and is unlikely to ever return to what we knew before the summer of 2007, but it is not as dire as some think. Borrowers just need to know who to talk to for the right advice.”

There is plenty of useful information about mortgages and good deals on this website, and a good place to start is here.