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Labour’s Renters Rights Bill – the government explains

July 22, 2024July 22, 2024 interestratesinfo

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The government has released more information on its new Renters Rights Bill, which is expected to be launched into Parliament in the autumn.

Only brief reference to the Bill was made in this week’s King’s Speech, when the Sovereign said: “Legislation will be introduced to give greater rights and protections to people renting their homes, including ending no fault evictions and reforming grounds for possession.”

But the government has now released background notes on this measure, and all others announced in the speech.

Mortgage bombshell leads to surge in the number of Brits ‘going bust’

July 22, 2024July 22, 2024 interestratesinfo

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.

Four more mortgage lenders slash rates as new home loan price war heats up amid interest rate cut hopes

July 22, 2024July 22, 2024 interestratesinfo

THE mortgage price war continues to heat up, with four more lenders slashing rates amid hopes of an interest rate cut.

TSB and Santander are the latest big names to reveal a drop in the cost of borrowing, easing the pain for homeowners and first-time buyers.

Mortgage rates remain high as the Bank of England hiked the base rate several times in a bid to tackle inflation

The base rate is used by banks to set interest rates for borrowing, including mortgages.

It has remained at 5.25% since August last year.

Mortgage Rates 22 July 2024

July 22, 2024July 22, 2024 interestratesinfo

The Bank of England held its Bank Rate at 5.25% in June, as was widely expected. It was the seventh time in a row the Rate has been frozen since it rose to its current level in August 2023. It had previously undergone 14 consecutive rises (between December 2021, when it stood at just 0.1% and August 2023).

The next interest rate announcement by the Bank’s Monetary Policy Committee (MPC) will be on 1 August at noon. The market is hoping that the Bank Rate will fall to 5% at that point.

How first-time buyers could save hundreds a year under Freedom to Buy plans

July 22, 2024July 22, 2024 interestratesinfo

First-time buyers could save hundreds of pounds on their mortgage bills under potential changes to the Government’s mortgage guarantee scheme, experts have told i.

The party’s election manifesto hinted at further changes to the initiative, which sees the Government act as a guarantor for people unable to save big deposits.

It promised to make the scheme “comprehensive” with “lower mortgage costs” and during the election campaign Labour said it will “will work with lenders” to increase uptake of the scheme – but it did not outline further details.

The party has already committed to making the existing mortgage guarantee scheme into a permanent fixture named Freedom to Buy.

The Tony Blair Institute for Global Change (TBI) told i there was potential to expand the scheme so it is compulsory for mortgage lenders, which would lower mortgage rates for first-time buyers with small deposits.

Buy-to-let mortgage market has shrunk ‘amid challenges for landlords’

July 22, 2024July 22, 2024 interestratesinfo

Strong rental demand and lending standards could mean the buy-to-let sector emerges from the downturn sooner than expected, UK Finance said.

The volume of lending for buy-to-let (BTL) house purchases more than halved over the course of 2023, according to a banking and finance industry body.

The number of new mortgage deals being granted for this purpose fell from 25,280 in the fourth quarter of 2022 to 12,422 in the first quarter of this year.

Rapidly rising interest rates played a major role in this trend, making it harder for those looking to buy a BTL property to pass lenders’ affordability tests, UK Finance said.

Watch out for sneaky mortgage tactic estate agents are using to ‘rip you off’

July 22, 2024July 22, 2024 interestratesinfo

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.

How half a million homeowners will dodge a mortgage rate hike

July 22, 2024July 22, 2024 interestratesinfo

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.

Labour to bring back housebuilding targets

July 15, 2024July 15, 2024 interestratesinfo

She promised her government would build 1.5 million homes over the next five years, as pledged in Labour’s election manifesto.

The party is set to reintroduce compulsory housebuilding targets, encourage development of poor-quality areas in the green belt known as ‘grey belt’ land, and make extra funds available for hundreds of new planning officers.

Speaking to business leaders at the Treasury on Monday, Reeves promised to focus on kickstarting economic growth in part by overhauling the planning system to speed up the delivery of more housing.

However, Reeves warned that this was not a “green light” to any kind of housing development, and that the right “mix” of affordable housing and homes for social rent would be built.

Birmingham City Council licensing scheme cracks down on rogue landlords

July 15, 2024July 15, 2024 interestratesinfo

Birmingham City Council is urging landlords to register their properties under new licensing schemes, or risk facing fines of up to £30,000.

The move comes as part of a broader initiative to enhance the quality and safety of rental housing within the city.

The legislation, which has been active for over a year, requires that all rental properties meet specific licensing requirements.

Landlords who fail to comply with these regulations not only face hefty fines but also expose themselves to Rent Repayment Orders (RROs) from tenants. These orders can allow tenants in unlicensed properties to reclaim up to 12 months of rent from their landlords.

Councillor Jayne Francis, cabinet member for housing and homelessness, said that the rules have been made clear and it is the responsibility of landlords to ensure that their properties have the correct licensing.