If you were thinking about moving home or moving your mortgage in the next few weeks, you may have decided to put your plans on hold.
Similarly, if you read our previous guide to the benefits of income protection and decided to arrange some cover, you may have postponed applying for the protection you need.
However, despite what you might have read, both insurers and mortgage lenders are open for business. The government has eased restrictions on moving home. And, companies are rising to the challenge by offering exceptional deals despite remote working restrictions.
It is certainly true that some lenders have stepped back from the market in recent weeks. While the total number of mortgage products is around about half of the level pre-lockdown, there are still hundreds of excellent deals out there.
Research from financial analysts Moneyfacts has found that, following the Bank of England’s decision to reduce the Base rate twice in March, the cost of mortgage deals has fallen.
For example, the average two-year fixed-rate mortgage deal fell from 2.43% to 2.19% between 11th March and 14th April 2020. The average five-year fixed rate fell from 2.73% to just 2.48% in the same period.
In terms of processing, many lenders are still accepting applications. There may be some slight delays in processing due to changed working arrangements, but conveyancing firm LMS has reported that remortgage completions are now 22% higher than they were in the week commencing 23 March.
Automated valuations ensuring mortgage lenders are open for business
In recent weeks, due to lockdown and social distancing guidelines, it has not been possible for surveyors to undertake physical valuations of homes.
While changes to lockdown guidelines mean that valuations are now recommencing, many lenders are using Automated Valuation Models (AVMs) to estimate the value of homes. These AVMs use data such as the price of homes in the local area to calculate a valuation for a property.
Each individual lender has a policy regarding when they will accept an AVM, and they normally restrict the maximum Loan to Value (LTV) to around 60%.
As a guide, Moneyfacts reports that the UK’s ten biggest lenders all use automated valuations on residential mortgages and eight of these will use this on remortgage applications of up to 60% LTV.
Speaking to an independent broker can help you to find the right deal and lender for you. If you’re a doctor, dentist, locum, consultant or other healthcare professional looking for advice, head to our dedicated site at Medic Mortgages or get in touch. Email info@medicalandgeneral.co.uk or call (01404) 515544.
In recent weeks, the government has updated the guidance regarding moving home.
Anyone in England can now move home as long as health guidance can be followed. This applies to both renters and buyers.
The government say: “The law previously only allowed moving home if you had reasonable grounds for doing so at this time.
“That restriction was necessary and appropriate at the time, but we are now able to change the rules so that people are free to start looking for a new home, and builders, developers and other property professionals are supported to return to work.
“This can be done while minimising the risk of spreading the virus through continued observance of hygiene measures and social distancing.”
If you’re thinking about moving home, it’s still possible to get your mortgage agreed and for you to take advantage of the current low rates. Lenders continue to accept applications and so you can put yourself in an excellent position to move quickly now that lockdown restrictions have been eased.
Income protection and life insurance providers also open for business
In the light of the current pandemic, you may have reflected on your own health and finances. Would you be able to meet your commitments if you fell ill? Do you have enough protection to ensure the financial security of your family if something happened to you?
Just as mortgage lenders have adapted to new ways of working, insurers are also very much open for business. Applications for popular products such as life insurance and income protection are being accepted and underwritten, with insurers using innovative methods of obtaining any medical information they need to process an application.
Since the national lockdown was introduced, it has not been possible for people to attend physical medical examinations if they have been requested by underwriters. In addition, insurers have been keen to avoid adding to the workload of GPs and medical professionals at this time by sending them questionnaires and requests for reports.
So, leading insurers have introduced 'virtual medical screening'.
A virtual medical examination will involve an online meeting through Skype or a similar video conferencing system. The screening will involve:
You may also be sent a self-test kit which involves taking a blood sample using a finger-prick device.
Justin Harper, head of protection marketing and external affairs at insurer LV= says: "We recognise the demands on GPs and other medical professionals, and support their efforts, particularly as many are increasingly being prioritised towards supporting the front line and at risk themselves.
"We're building on and extending our current practices to get customers covered without delay and help reduce the burden on the NHS, through avoiding and reducing requests for additional medical evidence and reports."
Please note
Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it.
