Tiuta has launched Underbridge, which will finance 100% loans on properties that have been undervalued by as much as 40% compared to their open market value.

Typically designed for properties bought at auctions, repossessed properties or distressed sales from property clubs or second homeowners, the 100% offer is based on an independently surveyed valuation of the property’s market value and is available for loans of up to £500,000.

Commenting on the launch, Gary Booth, CEO of Tiuta, said: “This new product is perfect for those borrowers who are looking at buying a distressed sale, for example at an auction, at a reduced price compared to its open market value. It is great news for professional buyers, or even first-time buyers, looking to buy a property at a discount with a view to remortgaging it or selling on. In the current climate, remortgaging is taking a long time, which can prohibit some borrowers.”

The launch of Underbridge follows the successful launch at the beginning of June of Refurbridge, another new innovative Tiuta product. Refurbridge allows borrowers to finance both the purchase price and the cost of refurbishing the property.

With Refurbridge, borrowers, whether they are developers or buy-to-let investors, can borrow 100% of the refurbishment costs of the property, as long as the cost does not exceed 75% of the Gross Development Value. The maximum loan amount that can be advanced is £500,000, with an interest rate applied monthly of 1.45%. The LTV is based on the property’s open market value, rather than the purchase or forced sale price.

Taken from:
http://www.mortgageintroducer.com/ccstor
y/230865/4/Tiuta_launches_full_bridge.htm

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Admin (Why Not Visit Our Main Site Over At http://www.glmsltd.com )

But with inflation hitting 3.3% last month, it was anticipated by several organisations such as the Confederation of British Industry that rates would remain unchanged.

The BoE’s Monetary Policy Committee has had to balance growing evidence of an economic slowdown against the problem of rising inflation.

Ian McCafferty, chief economic adviser for the CBI, says: “It was of little surprise to the markets that the bank held rates unchanged this month.

“The MPC needs to continue to stick to its mandate of delivering stability over the medium-term. A rate rise now would do little to influence the further rise in inflation expected in the near-term.”

He adds: “There is as yet little sign that the rise in commodity prices has had any effect on wage bargaining and hence core inflation.”

Andy McQueen, managing director of The Mortgage Works and UCB Home loans, suggests changing sentiment in the City means the expected outlook for future interest rates has altered in recent weeks.

He says: “While today’s decision was widely expected, the mood in
the City has been changing.

“In the last month we have seen a shift from a certainty that interest rates would continue to increase, to an expectation that they could be lower than previously thought over the next two years.”

McQueen adds: “This change, which has been reflected in forward swap rates, has mainly been influenced by the worsening state of the economy, particularly highlighted in recent weeks by the news of redundancies coming from the house builders.”

He says a worsening economy will prompt the MPC to maintain, and potentially even drop, rates going forward despite the threat of above-target inflation.

Ben Thompson, director of mortgages for Legal & General, says: “Money markets and pundits alike have been quick to assume that the BoE’s decision to manage away inflation vigorously means an imminent rise in the base rate.

“However, what today’s decision reflects is prudent sensitivity to the fact that in the face of an economic slowdown, inflation ought over time to return to more manageable levels.”

He adds: “This is a welcome view, as for now at least this protects borrowers from an increased level of financial pain.”

Jonathan Cornell, managing director at Hamptons International Mortgages, says: “If inflation at 3.3% can’t force the MPC into making a decision I don’t know what will. While any increase in the base rate signals worries for borrowers, unstoppable inflation is not a happy compromise.

 “June, like May, has done little to raise people’s spirits. Rising energy and food costs, coupled with decreasing house prices, will mean some people have felt more than just a pinch.”

Cornell adds: “Consumer confidence continues to plummet and there seems very little to keep our hopes up.”

He says that while the MPC takes another month to weigh up its priorities, borrowers should view the time as a lull before the storm and look to arrange their finances accordingly.
 
Brian Murphy, head of lending at the Mortgage Advice Bureau, says: “The MPC’s decision signifies the third consecutive month that the base rate has been held and the fourth since it was last cut.

“While the MPC’s prime concern is to keep inflation in check, factors such as a bleak housing market, as well as rising food and energy costs, have pulled the MPC from pillar to post in their decision over which area to prioritise.”

Murphy adds: “Increased food, transport and utility bills have placed additional pressures onto the consumer, reducing the amount of disposable income available to them each month.

“This has resulted in a sharp drop in consumer spending, and subsequently consumer confidence has nosedived to levels not seen since the early 1990s. Maintaining interest rates at 5%, and thus providing no respite to borrowers, will serve as a further blow to confidence levels.

“We do not see any respite for consumers and hard pressed borrowers in the short-term.”

 Taken from : The Mortgage Strategy Website @ http://www.mortgagestrategy.co.uk/cgi-bin/item.cgi?id=168779

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 Admin

Why not Head on Over to our main site at http://www.glmsltd.com

The firm revealed tenant demand increased month on month as well, with the number of leases commencing in May 2008 rising 14% from April.

Your Move said May’s increase in demand is part of a wider trend, as the number of leases commencing in April was 56% higher than the year before. The number of leases commencing in 2008 in total is up 34% on the same period in 2007.

David Newnes, managing director of Your Move estate agents, said: “Buy to let will grow this year. Opportunities to invest are ripe for professional landlords able to secure financing. With rising tenant demand comes rising rents - buy-to-let yields will consequently improve. House prices are under pressure at the moment, and there is scope for buy-to-let investors with collateral to get good deals to expand their portfolios.”

Taken From : http://db.riskwaters.com/public/showPage.html?page=800846

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Wasim

Visit us at www.glmsltd.com (Greenlight Mortgage Services Ltd)

That old economic theory of supply versus demand will fuel house prices in the future so potential buyers should enter the market now, according to the Assetz House Price Watch.

In its latest report, it states there is currently a great deal of pent up demand from buyers who are eager to buy but cannot secure the necessary finances. As a result, as soon as the mortgage market improves, a surge of activity is expected, as buyers flood the market. They will experience very low new-supply from developers and, combined with a general housing shortage, Assetz expects prices to return to a steady upward trend in the second half of 2009.

Assetz also believes that experienced buy-to-let investors are in a strong position to weather the current storm and to benefit from the increase in demand for rented accommodation. The current negativity has resulted in a significant fall in the number of first-time buyers entering the market over recent months, with many expected to stay away over the short term. As a result, strong rental demand is set to continue, providing good news for landlords.

Stuart Law, chief executive of Assetz, commented: “We are in a period of weakness, not a crash, and vendors are more easily negotiated with, provided they are a forced seller.

I would recommend that investors take advantage of the current market and continue adding to their portfolio by buying from motivated sellers. “Recent research has suggested that new home starts will fall to dangerously low levels this year – with only 110,000 new homes expected to be built by the end of 2008, less that half of those cited by Gordon Brown (240,000) as necessary to meet demand, followed by 80,000 or less homes expected to be built in 2009. As a result, house prices will rise again through raw supply and demand imbalance, with rents rising extremely strongly in the short term and firmly for many years to come.”

Taken from: http://www.mortgageintroducer.com/mortgages/2307 95/4/Daily_news/Outlook_good_for_house_prices.htm

Regards Wasim

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In case you aren’t aware of it, each time you apply for credit of some sort, whether it be a bank loan, credit card application or Hire Purchase, your prospective lender will carry out a search with their preferred credit reference agency to establish whether or not you are creditworthy.

Of the three factors that enable a lender to decide whether to loan you money, your credit files are probably the most important. Although only authorised organisations are permitted to gain access to them, they serve as an open book to those organisations about how well, or how badly, you manage your finances. Fortunately, you have a right to see them too so it’s a good idea to send off for them occasionally to make sure the information they hold is correct.

There are three credit reference agencies — Experian, Equifax and Callcredit — and they all hold information gleaned from the electoral roll such as your address details and the names of others who live at the property. They also contain details of any County Court Judgements and bankruptcies. Alongside that will be information passed on to them from various banks and building societies about your payment history for cards, loans, mortgages etc, that you already have.

Note that not all financial organisations share all the information they have on you with all three of the agencies, and most only refer to one of them when checking you out, so it’s quite likely that one agency does not hold a complete record of your credit history. However, since your payment records will affect how you decide to manage your finances, it’s important that the information any agency holds about you is up-to-date and correct.

So, what does a prospective lender see when they bring up your credit file?

Every time a search is carried out it is logged on your files and that information is available to every other lender who needs to access them. In some cases, this can go against you — for example, if you have approached several banks, it might appear that you have looking for lots of credit and have been turned down even though you may have a perfectly good reason for not proceeding. However, lenders are beginning to realise that a mere search may simply be an indication of a prospective borrower shopping around for the best deals and consumers can also ask lenders not to carry out a search in the early stages if they are simply making an inquiry.

If you have a joint bank account, mortgage or credit card, you have a “financial association” with someone else, say, your spouse, for example. However, if this person has had credit problems in the past, these could be held against you. Hence, if you are no longer financially connected with this person, be sure to tell the credit reference agencies, so that you can be listed as financially independent, which means that only your personal financial data will be recorded against your name.

If you go ahead with your application and you meet your monthly obligations on time, then your payment history for that particular borrowing will show up on your file as a series of zeros for each card or loan that you have. If you are late with your payments your track record is automatically altered even if you miss just one payment.

For example, let’s say you take out finance to buy a dishwasher over a six month period and you miss payments four and five and then catch up; your file will state 000120 ie: in month four you were 1 month behind and in month five you were 2 months behind.

Most prospective lenders aren’t too worried about the odd missed payment especially if you’ve clearly caught up and have a series of lovely zeros after the missed payments - sometimes people do simply forget to pay their credit cards, after all. It’s the Default notices and County Court Judgements which are most likely to be of concern and as these stay on your files for six years, even if you eventually manage to pay them off, it can still affect your chances of getting further credit. You’ll either be turned down flat or you’ll be charged a higher-than-usual interest rate.

There aren’t many ways to fix your credit files if they don’t look too good but you should certainly start by making sure that the information on them is correct. The credit reference agencies will rectify factual details if a mistake has been made.

If you have a bad record because of late payments, defaults or County Court Judgements, then there’s not much you can do to improve matters except to make sure that your payments are on time in the future. However, if you’ve missed a few payments for reasons that you think should be taken into account, you’re allowed to write a short explanation for your file so that it shows up when lenders run a credit search on you. For example, you might have been in hospital at that particular time or temporarily unemployed.

Ultimately, the only way to improve your credit rating is to pay off the debt. Lenders should automatically notify the agencies that any default is satisfied but it’s as well to check your files to ensure this is done. Alternatively, you can ask for a letter of satisfaction from the lender, which should then be sent to the agencies with a covering letter. Future lenders will at least be able to see that you did pay the debt off.

Be aware that certain things don’t look good on your credit report. Having too many cards and loans, even if you’ve been paying them off on time, might raise an eyebrow. The searcher will see how many credit cards you’ve got, the amount of credit that’s available to you and the balances you’ve got on each of them. They might wonder if you’re getting in over your head.

So, if you have a whole collection of cards that are gathering dust, consider cancelling them and closing the accounts. It could improve your credit score and, you never know, in a year or two, you might even qualify for introductory offers from cards you’ve had in the past as you’ll be considered a new customer. Don’t cancel them all at once because, just as multiple card applications look a tad suspicious, so do sudden multiple cancellations.

Equally you could be rejected for a loan or a credit card simply because you’re too good at paying off your debts and that simply may not be profitable enough for them. Don’t be too offended by this — take the trouble to find a lender who likes a good payer instead.

Credit Scores

Having checked your application form and your credit reference files, your prospective lender will then use that information to give you marks to determine whether you are a good or bad risk.

Each lender has different criteria when calculating your credit score. It depends on their target market and whether they want to lend money to people like you. It works on a points system: the more points you get, the more likely it is that you’ll get credit. See the following example of part of a credit score card:
 
 
Years in present employment Points
0-5                           0
6-10                         +15
11-12                       +30
13 or over               +50

Marital status
Divorced                   0
Widowed                  +10
Single                        +12
Married                    +40

Age
21-25                         0
26-30                        +5
31-39                        +40
40-59                        +55
60 or over                 +42

Number of Children
None                           +30
1                                  +15
2                                  +5
3 or more                     0

Age of most recent bad debt
No debts                      +5
Less than 3 months    -35
3-12 months                -30
1-2 years                      -27
2-3 years                      -15
 
 
Note that, in this instance, the moment you hit 60 your credit rating starts to drop and that children can be regarded as a liability! Other criteria on a scorecard might include points for or against your profession, the length of time you’ve lived at a particular address, whether you’re a homeowner and even whether you have a landline telephone. Your postcode may also be relevant because it indicates whether you live in an affluent area or not. Some of these things may not matter if your prospective lender is targeting students but they will if they want to catch the high-flying dual-income-no-kids market or those who might want to consolidate their debts.

However, the one crucial thing you can do for your creditworthiness is to make sure you are on the electoral roll. If you don’t show up as being on the electoral roll, most lenders will automatically refuse you credit. So if you’ve recently moved, phone up your local council and get yourself registered as soon as possible.
Regards

Wasim

visit our site at www.glmsltd.com also Mirrored on Blogger.com at http://glmsltd.blogspot.com/

The new standards, which come into effect on September 1, aim to ensure the conveyancing and valuation processes determine the true value of the property, reducing risk for both borrowers and lenders.
Some lenders are concerned the current processes do not always capture discounts and other incentives that buyers may be able to negotiate with developers when purchasing newly-built property. As a result lenders could unintentionally offer a mortgage based on a valuation of a property that is higher than the true price paid for it.

From September, lenders will require builders or developers of any newly-built, converted or renovated property to complete a new ‘disclosure of incentives’ form. This will be reinforced in the CML’s Lenders’ Handbook.

The Royal Institution of Chartered Surveyors will be amending its guidance to members to reinforce the requirement to disclose incentives to lenders. The Home Builders’ Federation and Homes for Scotland have recently reinforced their own codes of conduct to encourage greater transparency about discounts and other incentives and a number of major builders are taking their own steps to address the issue.

CML director general Michael Coogan says: “We are introducing these measures to help sustain confidence in the market for newly-built property. Lenders need to know about discounts and other incentives so they can be sure that the decision to offer a mortgage is based on a reliable valuation of the property. The new measures will provide additional security and safeguards for borrowers, as well as lenders.

“We welcome the support of RICS and house-builders in implementing this solution. Responsible builders and developers understand that lenders must have confidence in the valuation process. They are supporting our initiative because they understand that, in making these changes, we will reinforce confidence in the new-build market.”

Taken from http://www.moneymarketing.co.uk/cgi-bin/item.cgi?id=166815

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Wasim

www.glmsltd.com

Once again from the Mortgage Solutions Website:

Growing number of families choosing to rentRents continued to rise in April as tenant demand for private rented properties grew – especially among people in their 30s and 40s and those with families.

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Wasim

Also on our Blog at http://glmsltd.blogspot.com/

Main Greenlight Mortgage Services Ltd website at www.glmsltd.com

I found this interesting article on the Mortgage Solutions Website:

Prices flatlining not declining

There is currently no evidence of a market crash, according to data collated by research firm Asstez.

It has reported property prices have remained firm since the beginning of the year, with a current average of £211,014 in April – down only £4,015 (1.9%) from the peak experienced six months ago – £215,089 in October 2007.

The average house price in April 2008, taken from the average price provided by all five major indices showed a decrease of just £915, compared with the previous month’s average figure and an increase of £2,279 in the twelve months from April 2007, when the average price of a home was £208,735.

Stuart Law, chief executive of Assetz, said: “While house prices fell by 0.6% in April, prices remain up on the previous year and I am yet to see any firm evidence of a housing market crash. We saw a steep increase in house prices leading up to a peak in October last year.

“This was widely regarded as an unsustainable level of growth and we are currently embedded in a period of stabilisation, throughout which house prices in this country have remained extremely robust in spite of the difficulties in the mortgage market – down only 1.9% in April since the highest recorded average, taken in October last year - a far cry from the property crash that many commentators are misleadingly quoting.

“Over the long term, demand for housing will continue to outstrip supply and with Government targets of three million new homes by 2020 now looking impossible, as a number of housebuilders announce a halt to new starts, this will support future house prices and rental growth.

“The mortgage market problems (and to some extent the uncertainty over the housing market) is at present causing significant pent-up demand from first-time buyers, and once the mortgage market frees up I expect this demand to return strongly. The effect of this release of demand back into the purchase sector will probably surprise many, supporting house prices and even causing them to grow again in due course.

“The risks to house price stability over the coming months are primarily driven by the mortgage market. However, with announcements from some mortgage lenders that they are now reducing their mortgage rates, movement should return to the market and we should soon return to a degree of normality, perhaps as soon as September.”

 Regards

Wasim

www.glmsltd.com also mirrored at http://glmsltd.blogspot.com/

 Our Mirror Blog on Blogger.com is http://glmsltd.blogspot.com/

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 Wasim

Reminder - lending criteria 16/05/08

We have developed our product criteria to ensure that we are making sound lending decisions based on true property values. Our basic principle for House Purchases is that we will lend on the lower of purchase price (less any discounts), or valuation.

We reserve the right to decline any types of transaction that are found to contravene this principle at any time before release of funds. In particular:

• we reserve the right to refuse business where the seller has owned the property for less than six months.
• we will not accept business involving assignable contracts and sub sale purchases.
• we will refuse business if we believe that connected parties are attempting to sell properties between themselves at inflated purchase prices or at undervalue.

Example of an unacceptable transaction involving a third party
A property investor wants to purchase a property for £70,000 and a connected third party puts up the cash (for a fee). The property investor then applies for a mortgage on the house at the inflated value of £100,000 with the third party named as the vendor. The lender offers 85% of this, or £85,000. This means that the property investor has borrowed £15,000 more than the purchase price.

This is only one example of the types of transaction that are unacceptable to us.

There are still lenders out there that will look at Sub-sales, so its just a matter of checking the criteria before you opt from a mortgage product.

 Regards

Wasim

Please visit our main site Greenlight Mortgage Services Ltd at www.glmsltd.com