Gross mortgage lending came to £12 billion for the month, and the fall came after a steady increase in mortgage lending over previous months. Whilst seasonal factors have been taken into consideration by the CML officials from the group have said that the latest fall could not be attributed to seasonal factors alone.

The group said that whilst it was normal for a slight decline in mortgage lending to be seen between October and November the 10 percent decline was unusually large.

An economist from the CML, Paul Samter, also commented on the up and coming end of the stamp duty holiday, which is set to finish at the end of this year. He said that despite the imminent end of the stamp duty suspension the long term outlook for the sector appeared to be one of stability.

He said that he doubted that there would be much underlying change over the next few months as a result of the stamp duty holiday coming to an end.

He also said that things continued to look bleak for first time buyers, who continued to struggle to get mortgage finance, stating: “There has been a modest increase in the availability of mortgage credit recently, including some tentative signs of a few higher loan-to-value products emerging. But there is no sign of a swift recovery in lending volumes, especially with remortgaging set to remain at subdued levels while low interest rates persist.”

Fall of 10 percent in mortgage lending is a post from: Glitec Loans

Properties under the value of £125,000 have always been exempt from stamp duty, and by increasing this threshold to £175,000 on a temporary basis the government hoped to help more people onto the property ladder whilst at the same time boosting property sales in a struggling market.

However, recent figures have shown that whilst many consumers were optimistic about the move and welcomed the suspension of stamp duty the measure has not helped as many people as was hoped.

The government had predicted that based on the number of people that would save on stamp duty buyers would collectively save £600 million on house purchases in the first twelve months. However, according to figures released by the property website zoopla.co.uk only £173 million was saved during this period.

It is thought that there are a number of reasons why the figures have been so disappointing compared to the figures that had been predicted.

One of the main factors is that many would be first time buyers have found it extremely difficult to get a mortgage at all in the current climate regardless of stamp duty requirements, partly due to increased stringency from lenders and partly due to the high deposit levels that lenders have been demanding.

Nicholas Leeming from Zoopla said: “The stamp-duty holiday has so far failed to reinvigorate the housing market. Rather than ending it, the Government should consider extending it by making first-time buyers permanently exempt and by giving others the ability to defer payment for up to, say, five years.”

Stamp duty suspension was not as useful as hoped is a post from: Glitec Loans

The number of enquiries from first time buyers is said to have peaked in September, and some industry officials have claimed that this marks an increase in confidence in the property market.

One mortgage advice website stated that September saw the highest level of searches by first time buyers, and separate reports have claimed that it is now first time buyers that are keeping the property market buoyant, with remortgaging levels having gone through the floor.

Many first time buyers are keen to get onto the property ladder as soon as possible, as many fear that property prices may start rising sharply again and that mortgage interest rates may soar if the base rate goes up in the coming months.

There are, in fact, many reasons why first time buyers may be clamouring to get onto the property ladder sooner rather than later.

Firstly, property prices have been rising over recent months but are still far lower than their peak in 2007.

Secondly, with the base rate at an all time low some first time buyers are hoping to get a good deal that will help to keep their repayments down.

Finally, the government’s stamp duty suspension on properties up to £175,000 is still on till the end of the year, and many may want to take advantage of this.

However, there are still obstacles in the way for first time buyers, the major one being the level of deposit that most lenders are demanding in return for access to their more favourable and competitive mortgage deals.

Increased demand for mortgage advice from first time buyers seen as sign of recovery is a post from: Glitec Loans

Lenders are being accused to encouraging customers to come off standard variable rates, which at present are the best option due to the all time low base rate, and persuading them to opt for the more costly fixed rate mortgage option. This is despite the fact that many industry experts expect the base rate to remain low for quite some time yet.

Banks and building societies are also being accused of trying to get customers that are coming to the end of current deals to switch to more expensive deals rather than allowing them to revert to the standard variable rate.

Some are even being accused of failing to let customers know that they have the option of reverting to the SVR at the end of their current deal, making them think that they have to take out another deal that is more expensive than reverting to the SVR.

One industry expert stated: “Lenders appear to be encouraging borrowers on their cheap SVRs to switch to fixes; it is far from clear that this is the best advice. Borrowers may find that they are buying themselves security when there is little need to do so. When they come to the end of the deal, interest rates may be rising, and they will find themselves on a variable rate looking for another fix, which will inevitably be priced higher.”

There has also been controversy over the failure of banks to explain why it is a good idea for customers to pay a fee to switch to another deal, and an offiial from the Financial Ombudsman Service said: “We expect lenders to fully explain why it would be a good idea to get borrowers to pay a fee to switch deals. It is not enough simply to say ‘we don’t give advice’. If a customer feels that he or she is getting advice and it was not made clear that it was not advice, we will investigate.”

Borrowers being pushed onto costly fixed rates by lenders is a post from: Glitec Loans

The month saw a drop in the number of people looking to remortgage, but there was a return to the market – albeit a gradual one – of first time buyers who helped to keep the sector buoyant.

According to the Council of Mortgage Lenders there was an increase of 29 percent in new mortgage lending in August compared to the same period last year.

One official from the CML said that property purchasing was definitely back on a stronger footing even though recovery of the property market would be a gradual and drawn out process.

He said: “It will be a drawn-out recovery process, with seasonal ups and downs, but house purchase activity is now on a firmer footing.” The CML figures did show that remortgaging acticity remained weak at present.

The reports also showed that many people are now coming to an end of their fixed rate mortgage deals, which many took out for two or three years when interest rates were on the increase in the hope of protecting themselves against soaring repayments. However, interest rates have been at an all time low of just 0.5 percent for seven months, so many will be relieved that these higher rate fixed mortgages are coming to an end.

Industry officials have predicted that those whose fixed rate mortgages are coming to an end will shy away from remortgaging to another fixed rate deal for the moment, as the base rate is so low that they will want to benefit from the savings that are available on standard variable rate mortgages.

However, remortgaging activity may pick up later in the year when there is a greater threat of the base rate increasing again.

Mortgage lending propped up by first time buyers is a post from: Glitec Loans

This was a safety net for landlords who wanted to ensure that they would not be left high and dry with tenants that could not actually afford the rental payments on the home.

However, following the turbulent times that the mortgage market has been through over the past couple of years there has now been a turnaround in this trend, and tenants are now running their own checks on landlords to ensure that everything is above board and the landlord is not on the verge of having the home repossessed, which would quickly leave the tenant stuck without any place to live.

One lettings official said that there had been a marked shift in the trend when it came to landlords and tenants running checks, and he added that prospective tenants were asking far more about the backgrounds of the landlords as well as about where their deposits will be held.

He said: “Tenants have been far more interested in landlords’ backgrounds and are asking more questions about where their deposit is being held.” Speaking of the relatively new arrangement with regards to deposits being held in government approved schemes he added: “As the deposit typically amounts to six weeks’ rent, we are finding fewer tenants are comfortable with this arrangement although in the vast majority of cases the lettings agent keeps hold of the funds.”

Turnaround with buy to let reference checks is a post from: Glitec Loans

There has now been another blow for first time buyers, after another lender decided to withdraw its 90 percent mortgages.

A tenth of 90 percent mortgages that were taken out over the past three months are thought to have come from Britannia, but the lender has now joined a plethora of other nervous lenders by withdrawing this offering from its shelves, leaving even more first time buyers high and dry.

There are still some 90 percent loan to value mortgage left on the market, but buyers are rapidly running out of choice. In the past the traditional mortgage loan was for 95 percent of the property value, which meant that buyers only had to find 5 percent of the property value in order to get the loan.

In some cases first time buyers were able to borrow 100 percent of the property value and even 125 percent of the value of the property, but these jumbo mortgages disappeared shortly after the onset of the global credit crunch.

For those that are able to raise higher deposit levels such as 25 percent or even 40 percent there are some very good deals available in terms of mortgage interest rates, but those that can only raise small deposit levels such as 10 percent will not find that not only will they pay far higher rates of interest, despite the base rate being just 0.5 percent, but also that they will have very little choice.

90 percent mortgages withdrawn by Britannia is a post from: Glitec Loans

The news comes just as many first time buyers may have given up hope given that more and more 10 percent deposit deals are disappearing from the market and house prices have been rising over recent months. The scrapping of legal fees on these mortgages will give first time buyers a little more leeway when it comes to affordability.

However, there is a snag. The new Homebuyer Plus mortgages from Abbey vary in terms of interest rate depending on how much deposit the borrower is able to put down, and in order to qualify buyers will need a deposit of at least 20 percent of the property value, which for many could prove to be a big problem.

For those that are able to raise this deposit there is the opportunity to get a mortgage that does not charge for legal fees or for valuations.

Industry officials have said that first time buyers that do qualify for these mortgages stand to save up to £1000 on the cost of buying a home.

One official said: “These mortgages should save first-time buyers typically around £800 to £1,000. Legal work costs about £500 while the valuation depends on the price of the property, but is around £295 for a property worth £200,000.”

Whilst many first time buyers have been struggling to get onto the property ladder and afford a mortgage some officials have said that they are now better off than they were a couple of years ago.

This has been put down to the fact that property prices are now far lower than they were at their peak and stamp duty has been suspended on properties up to £175,000, whereas the previous threshold was just £125,000.

First time buyers get some good news is a post from: Glitec Loans

Before the credit crunch first time buyers were able to get 100 percent and even 125 percent mortgages, but since the onset of the financial crisis lenders have been cutting back on their lending levels.

The lender has now launched a range of mortgages with relatively attractive interest rates for those that only have a deposit of 10 percent, which will prove to be great news for borrowers that do not have the 20 percent or more deposit that many lenders are looking for. First time buyers are amongst the groups that have suffered as a result of these4 demands from lenders, as many do not have a high enough deposit to get a competitive deal on their mortgages.

The deals are being made available to both existing customers that are looking to move home as well as new buyers, and it is hoped that an increasing number of lenders will follow suit and also start offering competitive deals to first time buyers who do not have a huge deposit to put down.

One customer who was looking for a mortgage said: “Since the onset of the global credit crunch it has become far harder for first time buyers to get onto the property ladder because of the huge deposits that lenders have been demanding. I hope that this move by Nationwide is the start of a new era where lenders will start offering affordable mortgages to those that do not have huge deposits to put down, as is the case with most first time buyers.”

90 percent mortgages available through Nationwide is a post from: Glitec Loans

However, as a recent report has indicated it is not all good news and at present the future for the mortgage sector is still very challenging for both lenders and borrowers.

Figures showed that in August of this year mortgage lending increased by £1 billion, and major banks approved over 80 percent more mortgages than they did in the same month of the previous year, indicating that there was some improvement being seen in the market. A number of banks over recent weeks have declared that they are putting more money aside for lending, which could improve consumers’ chances of getting finance.

However, according to some industry officials some lenders, such as smaller banks and building societies, are struggling to put aside more money to lend in the form of mortgages, mainly because they are failing to attract custom from savers due to poor savings interest rates, which means that they have inadequate finances to back up their mortgage lending activities.

This means that lending is still restricted for many, and one mortgage website official said: “Demand is strong, but there are plenty of people who remain frozen out by the banks. We’ve seen record numbers of visitors to our site over the last couple of months, yet we know that tight lending restrictions will prevent many responsible borrowers from gaining finance. Before we see any change of pace in recovery, lenders must become more reasonable in their lending criteria.”

Mixed news on mortgage lending is a post from: Glitec Loans