What’s happening with UK mortgages right now?

The military action in Iran might be thousands of miles away – but many homebuyers are wondering what’s happening with UK mortgages right now.

You have probably seen reports about fixed-rate deals rising and lenders pulling hundreds of mortgage products.

And that might be worrying if you’re in the middle of buying a home or thinking about remortgaging. But it’s not as alarming as it might first appear.

Here, we will outline what is happening and how it might affect you. And we’ll also offer some advice.

As ever, if you’re uncertain, don’t just make decisions without taking advice. We are happy to talk to you about your mortgage or remortgage.

What’s happening with mortgage deals?

Over the past few weeks, some lenders have pulled mortgage products from the market at short notice. This can make it feel like options are shrinking. But the reality it’s usually part of a short-term adjustment.

Behind the scenes, lenders base their pricing on the cost of borrowing money themselves, which is influenced by financial markets. When those costs rise quickly – as they have due to the war in Iran – lenders often pause, withdraw certain deals, and then return with updated rates once things settle.

The media might be shouting about products vanishing, but they’re often just being replaced. Or they’re on hold because the current situation is changing daily. Until they fully understand the wider impact to the financial markets, they will proceed with caution.

Why are rates rising?

Even without a dramatic change in the Bank of England base rate, mortgage rates can still move. And that can sometimes be quite quickly.

That’s because lenders are constantly looking ahead. As we’ve already said, the finance industry wants to understand what’s happening and how it might impact the market.

There’s ongoing uncertainty around inflation, energy prices and the wider global economy – and all this affects all financial markets. It has led to expectations that interest rates could stay higher for longer than previously thought.

As a result, mortgage rates have edged upwards again, with many fixed-rate deals becoming more expensive over the past month.

Should we worry?

The current situation is a period of change, but it’s not a repeat of past crises.

Lenders are still open for business, and there are plenty of mortgage options available. What we’re seeing is a market that’s reacting quickly to economic conditions, rather than one that’s shutting down.

In many cases, lenders are simply taking a step back to reprice, and new deals are already starting to come back onto the market. As ever when it comes to homebuying, don’t panic!

If you are worried, we can lock a rate in for up to six months – which is perfect if you need a mortgage or to remortgage within that time.

What if I need a mortgage now?

If you’re planning a move or your thinking of remortgaging as your current deal is coming to an end, then you may be wondering whether to act now or later.

There is no one-size-fits-all answer – but there are a few sensible steps that can help you stay in control.

Firstly, don’t panic. While the market is moving, decisions made in a rush aren’t always the best ones – despite the alarmist media headlines. At the same time, in a rising-rate environment, waiting too long can mean missing out on better deals that are available today.

One of the most useful things you can do is secure a rate early. Many lenders allow you to lock in a deal for several months, which can give you peace of mind if rates continue to rise. And in some cases, you may still have the option to switch to a better deal later if things improve.

It’s also worth remembering that the lowest rate isn’t always the best choice. Flexibility, fees and how long you plan to stay in your home all play a part in finding the right mortgage for you. Your ideal mortgage may not have the lowest interest rate!

Why you need to speak to a broker

With the market changing quickly, it’s difficult to keep up. Afterall, you have your own work and life to deal with. That’s why a mortgage broker can help.

Rather than being limited to a single lender, a broker can help you explore a wide range of options and spot new deals as they become available. That’s something you can’t do with a high street lender, as they only have their own products to recommend.

A broker guides you through the process without the jargon. It also means you don’t have to keep checking rates or worrying about timing everything right.

There’s no doubt that the mortgage market is going through a period of uncertainty. Rates may continue to fluctuate, and we may see more products come and go in the short term.

But the key thing to remember is that the market is still active, and there are still good opportunities available with the right approach.

We can help

If you’re unsure what the recent changes mean for you, or you’d simply like to talk things through, we’re always here for a friendly, no-pressure chat.

Whether you’re buying your first home, moving or remortgaging, we’ll help you understand your options with access to more lenders and deals than a high street lender or a comparison website.

Contact us today for a chat if you’re concerned or need help mortgaging or remortgaging.

Your home may be repossessed if you do not keep up repayments on your mortgage.

You may have to pay an early repayment charge to your existing lender if you remortgage