Mortgage customers vote with their feet to beat referendum

Around one in seven (13%) mortgage and remortgage customers are trying to speed up applications so they can finalise deals ahead of the European Union Referendum on June 23rd, our latest research shows*.  

The study shows first-time buyers are more concerned about closing deals ahead of the EU Referendum – around three-quarters of those trying to hurry through applications are buying their first house.

However just one in five (20%) of mortgage brokers say clients are asking about the possible impact of the Referendum on their application and 80% of brokers say the Referendum is having no impact on their business. The research shows 35% of brokers are mentioning the possible impact of the Referendum to clients.

The debate about the UK’s future membership of the European Union is driving concerns among homeowners and would-be homebuyers with just one in three (34%) saying they have no concerns if the vote on June 23rd is to leave.

Mortgage customers’ biggest fear is general economic uncertainty ahead of any specific impact on mortgage rates and applications. Around 42% say they are worried about economic uncertainty in the event of a vote for Brexit with interest rate uncertainty the second biggest concern for 30% of customers.

Analysts are split on the potential impact on the housing and mortgage market of the Referendum with City economists forecasting a potential rate cut if the UK votes Leave while Council of Mortgage Lenders data shows gross March lending was at its highest since 2007 at £25.7 billion mainly driven by the rush to beat new buy-to-let lending stamp duty rules.

Ian Gibbons, Senior Mortgage Broking Manager at Nottingham Mortgage Services (part of The Nottingham), said: “The Referendum debate has dominated the headlines since the date was announced at the end of February and is certain to continue doing so until the votes are counted.

“There have been all kinds of forecasts and predictions about what might or might not happen depending on the result and it is clearly having an impact on the mortgage market with people hurrying to complete applications.

“No matter how you intend to vote it makes sense to search the whole market when sourcing a mortgage deal and there will be options for borrowers no matter whether the UK decides to remain or leave on June 23rd.”

The table below shows the concerns customers have about the impact on the housing and mortgage market of a potential vote to leave the European Union

Concerns Percentage                                                             
General economic uncertainty
Interest rate uncertainty 30%
Mortgage rates rising 26%  
New regulations 19%  
House price uncertainty 19%  
House price falling 12%  
Lenders less willing to accept applications 11%  
No concerns 34%  

The goal of Nottingham Mortgage Services is to find the best mortgage deal for customers by offering a fee-free service that searches over 50 lenders. From first-time buyer mortgages, re-mortgages through to mortgage for house purchase and buy-to-lets, it has been successfully helping people find the right deal on their mortgages for a number of years. Its expert advisers search the whole of the mortgage market, looking for the best deals. They explain the costs and benefits of each mortgage and will only recommend a mortgage that is right for the customer.

Your home may be repossessed if you do not keep up repayments on your mortgage.

* Research conducted online between 20th and 21st April 2016 among a nationally representative sample of 1,065 adults 18+ by independent market research firm Consumer Intelligence


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