Category: Mortgage

The number of Britons “going bust” is up by a third on the same month last year against the background of mortgage hikes and the cost of living crisis.

Personal insolvencies in June were 10,395, which was up by 10.3 percent on May and by 32.9 percent on the same month last year.

High interest rates, which have pushed up the cost of mortgage repayments, and the fact more people are relying on credit cards to cover essentials, are seen as factors behind the increase.

The main driver of the increase in personal insolvencies is a rise in Debt Relief Order (DRO) numbers, which hit their highest level since January 2021 following the removal of the fee to apply. There has also been a rise in IVAs – Individual Voluntary Arrangements.

A DRO is an option for people in debt where they owe less than £50,000, do not own their own house, do not have any assets of value and not much spare income.

Individuals need to speak to a special DRO adviser, who will provide help to make an application to the official receiver.

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HOMEBUYERS pressurised into using estate agents’ mortgage services face being “ripped off”, warn experts as cases of conditional selling rise.

Conditional selling, banned under industry regulations, happens when estate agents try to strong-arm or incentivise buyers to use their mortgage broker.

Buyers who refuse are told it could affect their chances of securing the property.

It’s an underhanded practice that has been around for a long time say brokers. But recently it has become more widespread.

If persuaded, buyers could wind up paying too much for their mortgage, for the property and for extra services such as insurance and legal work.

Sun Money explains how to spot signs of pressure selling and what you can do to avoid it.

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Such was the effect on households of the rise in the cost of mortgage deals that followed the Liz Truss mini-Budget in September 2022 that Chancellor Rachel Reeves is planning legislation intended to prevent a repeat of similar shock announcements on spending and tax. 

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My husband and I jointly own our home, which has a £86,000 mortgage left to pay. It has 18 years left and we have one year remaining on our current 1.69 per cent fixed rate.

Our property has about £260,000 equity in it due to house prices rising in the past and extensive renovations. 

We are both 49 and work full time on average salaries. We have no pension apart from state pension; our only asset is the property. We have a plan to downsize once our daughter, who is 10, leaves home to help pay for retirement.

My question is, is it worth trying to pay the mortgage off faster?

We could probably put a £20,000 lump sum towards it, and make an overpayment of £500 each month. This would mean we could pay it off in six years rather than 18. 

But would we be better off just putting the money into pensions instead? 

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Estate agents’ body Propertymark has issued a report called ‘A Dickensian Legal Process’ exploring why it takes long and longer to exchange contracts on a property for sale.

In March 2016 78% of transactions progressed from offer acceptance to exchange of contracts within 12 weeks, whereas in March 2024 the figure was just 29%.

While most agents in the report blame solicitors’ ways of working for delays, at least one has it in for lenders, saying: “I think lenders are taking too long to send out mortgage offers. Generally, the whole system is much slower to the previous 30 years.”

Timothy Douglas, head of policy and campaigns at Propertymark, comments: “It is not new news that the amount of time taken to complete a purchase on a home is becoming increasingly tedious and lengthy. However, it’s important more than ever considering that the time taken to complete is up to six months and longer in some cases, to understand the fundamental issues causing this.

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