The uncertainty of lockdown has led to changes across all industries. In the mortgage sector, a number of lenders withdrew some of their products temporarily. However, we’re glad to reveal that lenders have started to expand their ranges of mortgages now that we move into the phase of leaving lockdown.
The reason for lenders restricting their mortgage products was so that they would be able to handle the increased demand from homeowners seeking a payment holiday. Plus, office closures and staff shortages meant that physical valuations had to halt.
Nevertheless, over the past few days, we have noticed that a number of lenders have started to reintroduce some of the deals that they withdrew, for example, higher loan to value (LTV) mortgages.
Two of the UK’s biggest lenders, Nationwide and Halifax, have expanded their mortgage products, including higher LTV deals, increasing the number of different mortgage solutions that customers have available to them.
The reason why some lenders have been able to introduce these products again is that their use of desktop and automated valuations have been expanded. These systems calculate the value of a property through the use of comparable transactions and other pieces of data. This means that for a lot of borrowers, applying for a mortgage can be possible. However, this is not the case for those with high amounts of equity. For instance, HSBC is using desktop valuations for loans that are up to 90 per cent of the value of the property.