Brexit and its effect on the mortgage market

What does Brexit mean to the mortgage market. Initially during this reflection period I cannot see it affecting mortgages in any way at all.

As Mr Osborne and Mr Carney have stated, the UK economy is in a strong position to deal with the fallout of the vote for the UK to leave the EU. Mortgage lenders are in business to lend money to the public and businesses alike. They are financially 10 times stronger than they were in 2008 when the credit crunch hit. The bank of England and the Treasury have planned for a possible Brexit and will do everything necessary to support the economy.

For those who have mortgage applications currently in process, you will see no change at all. For those who are thinking of purchasing or re-mortgaging you will currently see no changes at all.

Dependent on what happens to the economy and inflation in the future we may see interest rates starting to rise. But of course this is impossible to predict one way or the other as we have not experienced a situation like this before.

You could be in one camp or the other. There are those who will wait and see what happens and then make a judgement and there are those who prefer to be more cautious and will act now to safe guard themselves.

Currently we are in an envious position of mortgage interest rates never being as low as they are today. My concern is for people who are currently on variable rate mortgages and what should they do now to protect themselves against possible interest rate rises. With 5 year fixed rates as low as 2.19% and 10 years rates in the region of 3.09%, surely these seriously low fixed rates are worth very serious consideration to protect family and home against any Brexit fallout.

Peter

Posted on June 27, 2016 by Peter Marriott, in: Uncategorized

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