blog mortgage118

Author: David Sampson

  • Over 1.5 Million UK Homes Classified as Unmortgageable

    Over 1.5 Million UK Homes Classified as Unmortgageable

    Recent research reveals that over 1.5 million homes in the UK may be deemed ‘unmortgageable’ by mainstream lenders, significantly impacting potential buyers and investors. This situation arises from specific property characteristics that fail to meet the lending criteria of many high street banks.

    TL;DR: More than 1.5 million UK homes are considered ‘unmortgageable’ due to factors like thatched roofs and short leases; this affects buyers and investors seeking alternative properties.

    What Makes a Property Unmortgageable?

    According to the findings, around 6% of the UK’s 28 million residential properties are classified as unmortgageable. Key factors include thatched roofs, short leases, solid-wall construction, high-rise locations, proximity to commercial premises, and the absence of essential amenities like kitchens or bathrooms. Such characteristics often deter mainstream lenders from providing financing.

    Why Are Buyers Interested in These Properties?

    Despite the challenges, many buyers are drawn to properties that fall outside standard lending criteria. Approximately 44% of those who have considered such properties believe they offer better value than conventional homes. Additionally, 31% are looking for renovation projects, while 28% see these homes as opportunities to increase value before resale. The lower purchase price also attracts buyers, with 28% citing it as a significant incentive. For buy-to-let investors, 35% are motivated by the potential for rental income.

    What This Means for Buyers and Investors

    For prospective buyers and investors, the classification of over 1.5 million homes as unmortgageable presents both challenges and opportunities. Many buyers may face mortgage application rejections, with 21% reporting such experiences. Furthermore, 32% noted a limited choice of lenders willing to consider their applications. This trend necessitates a more thorough understanding of alternative financing options, such as specialist lenders who may be more open to unconventional properties.

    Frequently Asked Questions

    What should I do if my mortgage application is rejected?

    If your mortgage application is rejected, consider consulting with a mortgage broker who can help identify lenders that specialize in unconventional properties.

    Are there alternative financing options for unmortgageable homes?

    Yes, specialist lenders often provide financing for properties that do not meet the criteria of mainstream banks, making them a viable option for buyers interested in unmortgageable homes.

  • Remortgaging Landlords Boost Buy-to-Let Activity

    Remortgaging Landlords Boost Buy-to-Let Activity

    The buy-to-let (BTL) market is witnessing a surge in activity, primarily driven by landlords remortgaging their properties. Recent research indicates that this trend is significant, with remortgages and product transfers making up a large portion of all recent transactions, highlighting a shift in focus from new purchases to refinancing existing loans.

    TL;DR: Remortgaging landlords are driving BTL activity, with many mortgaged landlords ending fixed-rate deals recently; a notable portion plan to remortgage in the next year.

    Why Are Landlords Remortgaging?

    Many landlords are coming to the end of their fixed-rate mortgage deals, prompting a wave of remortgaging activity as they seek to secure better rates or terms. When their fixed-rate deals expired, a significant number opted to remortgage with their existing lender, while others switched to different lenders, indicating a robust market for refinancing.

    What Does This Mean for Landlords?

    For landlords, the current environment presents both opportunities and challenges. Many are actively seeking to arrange their new deals well in advance of their existing deals ending. This proactive approach can help secure more favourable terms in a fluctuating market.

    How Are Portfolio Landlords Affected?

    Portfolio landlords, who hold multiple BTL mortgages, are particularly impacted. A considerable portion of these landlords anticipate refinancing in the coming year, suggesting they are keen to optimise their financing strategies to improve cash flow or reduce costs.

    Frequently asked questions

    What should landlords consider before remortgaging?

    Landlords should evaluate their current mortgage terms, compare mortgage rates, and assess their long-term investment strategy before making a decision.

    How can brokers assist landlords in this process?

    Brokers can provide valuable insights into the best remortgage options available, helping landlords navigate the complexities of refinancing and ensuring they secure the most beneficial terms.

  • Key Changes in the UK Mortgage Market Over 15 Years

    Key Changes in the UK Mortgage Market Over 15 Years

    The UK mortgage market has undergone significant transformations over the past 15 years, with evolving lender relationships and increased collaboration among industry players. Suzanne O’Connor, chief relationship officer at LMS, highlights these changes, noting the shift from working with just five lenders to over 50 today. This evolution reflects broader trends in the property market, impacting borrowers, landlords, and brokers alike.

    TL;DR: The mortgage market has expanded from five lenders to over 50 in 15 years; this shift has redefined relationships and expectations for borrowers and brokers.

    How Have Lender Expectations Changed?

    Over the last decade and a half, lender expectations have shifted considerably. Initially, lenders focused primarily on traditional metrics for assessing risk and approving loans. Now, they are more inclined to consider a holistic view of a borrower’s financial situation, including their overall financial health and the potential for long-term relationships. This change is driven by the need for lenders to adapt to a more competitive market, where customer retention and satisfaction are paramount.

    What Broader Insights Can Be Gained from Working Across the Property Ecosystem?

    Working with a diverse range of partners—including lenders, brokers, and conveyancers—provides a comprehensive perspective on the mortgage market. This collaborative approach enables industry players to identify emerging trends and challenges more effectively. By understanding the interconnectedness of various roles within the property ecosystem, stakeholders can better navigate the complexities of the market, leading to improved service delivery and customer outcomes.

    What This Means for Borrowers and Landlords

    For borrowers, the evolution of the mortgage market signifies a more customer-centric approach from lenders. This shift may result in more flexible lending criteria and tailored mortgage products that cater to individual needs. Landlords can also benefit from the increased competition among lenders, potentially leading to better mortgage rates and terms. As lenders collaborate more with technology providers, borrowers may see enhanced digital solutions that streamline the mortgage application process.

    What Leadership Lessons Have Emerged from 15 Years in the Mortgage Market?

    Leadership in the mortgage market has evolved alongside the industry itself. Key lessons include the importance of adaptability and collaboration. The government’s clear direction for reform through its home buying and selling roadmap has underscored the need for industry stakeholders to work together. This collaboration is essential for implementing effective changes that benefit all parties involved, from lenders to borrowers. Leaders in the mortgage sector must remain agile and responsive to the changing market to maintain competitiveness.

    Frequently asked questions

    How has the role of technology changed in the mortgage market?

    Technology has become integral to the mortgage market, enhancing efficiency and customer experience. Lenders are increasingly using digital tools to streamline processes, making it easier for borrowers to apply for and manage mortgages.

    What should borrowers watch for in the evolving mortgage market?

    Borrowers should keep an eye on emerging mortgage products and changing lending criteria as competition increases among lenders. Staying informed about market trends can help them secure better rates and terms.

  • Buy-to-Let Remortgaging Reaches Record High in 2026

    Buy-to-Let Remortgaging Reaches Record High in 2026

    Buy-to-let remortgaging has surged to a record high, with a significant portion of landlords with mortgages refinancing in the year leading up to June 2026. This increase reflects a strong trend in the buy-to-let market and highlights the growing importance of remortgaging for landlords.

    TL;DR: A record number of landlords with mortgages remortgaged in the past year, reflecting a strong trend in the buy-to-let market; landlords are prioritising refinancing over new property purchases.

    What Does This Mean for Buy-to-Let Landlords?

    The rise in remortgaging activity indicates that landlords are actively managing their financial positions, particularly as many fixed-rate deals have matured recently. Many mortgaged landlords reported that their fixed-rate deals expired within the last two years. Among these, a considerable portion chose to remortgage with their existing lender, while others opted for a different lender. This suggests a strong preference for maintaining existing relationships, likely due to perceived stability and familiarity.

    How Are Landlords Preparing for Buy-to-Let Remortgaging?

    Landlords appear to be planning ahead, with many arranging their new deals between three to six months before their current fixed rates expire. This proactive approach helps mitigate potential interest rate fluctuations and ensures they secure the best possible terms. Looking forward, a notable portion of landlords with borrowing are expected to remortgage or transfer products within the next year, covering multiple loans each. Notably, portfolio landlords, those with several buy-to-let mortgages, anticipate refinancing multiple loans each, indicating a significant commitment to managing their portfolios effectively.

    Why Is Remortgaging Dominating the Buy-to-Let Market?

    Remortgaging and product transfers now account for a large share of recent buy-to-let transactions, contrasting sharply with the activity attributed to new property purchases. This shift highlights the current market’s focus on refinancing rather than expanding property portfolios. The preference for fixed rates remains popular among landlords, with some still undecided on their next product, indicating a cautious approach amidst changing economic conditions.

    What This Means for Brokers and Investors in Buy-to-Let

    For brokers, the increasing remortgaging activity presents an opportunity to assist landlords in navigating their refinancing options. Understanding the motivations behind landlords’ choices can help brokers tailor their services effectively. Investors should also take note of this trend, as it reflects broader market sentiments and potential shifts in rental yield expectations. Keeping an eye on current mortgage rates will be essential for both landlords and brokers as they strategise for the coming months.

    Frequently Asked Questions

    What factors are driving the increase in buy-to-let remortgaging?

    The increase in remortgaging is driven by a significant number of fixed-rate deals maturing and landlords seeking to secure favourable terms before potential interest rate changes.

    How can landlords prepare for remortgaging?

    Landlords should plan ahead by starting the remortgaging process three to six months before their current deals expire, allowing them to secure the best rates and terms available.

  • Metro Bank’s 73% Growth in the Mortgage Market

    Metro Bank’s 73% Growth in the Mortgage Market

    Metro Bank has reported a remarkable 73% growth in specialist mortgage lending, reflecting a strong performance in the UK mortgage market. The bank’s new gross lending reached £1 billion in the first half of 2026, contributing to a total retail mortgage portfolio of £4.8 billion, which now accounts for 53% of its overall lending.

    TL;DR: Metro Bank’s specialist mortgage lending surged by 73%, with total retail mortgages hitting £4.8 billion; this growth impacts borrowers and investors in the mortgage market.

    What drove Metro Bank’s mortgage growth?

    The bank’s target lending segments, including corporate, commercial, and SME banking, alongside specialist mortgages, experienced a 43% year-on-year increase, reaching £6.2 billion. This growth was bolstered by a 30% rise in commercial lending, which climbed from £3.1 billion to £4 billion during the same period. The £1 billion of new gross lending in H1 2026 played a significant role in this expansion.

    How did Metro Bank’s profits perform?

    Metro Bank reported an underlying profit before tax of £60.6 million, up 34% from £45.1 million a year earlier, marking its most profitable half-year to date. Underlying net interest income also saw an 8% increase year-on-year, reaching £241.5 million, while overall revenue rose by 5% to £301 million. The net interest margin improved from 2.87% to 3.18%, indicating enhanced profitability in its lending operations.

    What does this mean for the mortgage market?

    For borrowers, particularly those seeking specialist mortgages, Metro Bank’s growth signals a more competitive market with increased lending options. Investors in the mortgage sector may view this as a positive indicator of the bank’s financial health and commitment to expanding its lending portfolio. The decline in non-performing loans to 4.39% from 5.42% a year earlier suggests improved credit performance, which could lead to more favourable lending conditions. To ensure you find the best deals, consider checking mortgage rate comparisons.

    Frequently asked questions

    What types of mortgages are included in specialist lending?

    Specialist lending typically includes mortgages for unique circumstances, such as buy-to-let properties, self-build projects, and lending to those with adverse credit histories.

    How can I find competitive mortgage rates?

    To find the best mortgage rates, consider using comparison tools that evaluate current mortgage rates across various lenders, ensuring you secure the most favourable terms.

  • Buy-to-Let Remortgaging Hits Record High in 2026

    Buy-to-Let Remortgaging Hits Record High in 2026

    Buy-to-let remortgaging has surged to unprecedented levels, with a significant portion of landlords with a mortgage having refinanced in the year leading up to June 2026. This notable increase matches the record set at the end of 2025 and is a rise from previous years. This trend underscores the growing importance of refinancing in the current buy-to-let market.

    TL;DR: A record number of landlords refinanced their buy-to-let mortgages in the past year; this trend indicates a strong focus on remortgaging over new property purchases.

    Why Are Landlords Choosing to Remortgage?

    Refinancing continues to dominate the buy-to-let market, with remortgages and product transfers making up a significant portion of recent transactions. In contrast, a smaller percentage of activity is attributed to mortgages for new property purchases. This shift suggests that many landlords are prioritising financial stability and better rates over expanding their property portfolios.

    What Are the Trends in Buy-to-Let Remortgaging?

    Research indicates that many mortgaged landlords have had a fixed-rate deal mature within the last two years. Among these landlords, a majority chose to remortgage with their existing lender, while a notable portion opted to switch to a different lender. Additionally, a proactive approach is evident, with many landlords arranging their replacement deals several months prior to their existing fixed rate expiring.

    What This Means for Buy-to-Let Landlords

    The current remortgaging climate presents both opportunities and challenges for landlords. A significant portion of landlords is planning to remortgage or arrange a product transfer within the next year, covering multiple loans each. Portfolio landlords, who manage several buy-to-let mortgages, are especially active, with many expecting to refinance in the coming year. This trend highlights the importance of strategic financial planning and market awareness.

    What Should Buy-to-Let Landlords Watch Next?

    Landlords should keep an eye on the evolving mortgage market, particularly regarding fixed-rate products. Two and five-year fixed rates are equally popular among landlords, yet a portion has yet to decide on their next product. This uncertainty may indicate a need for more tailored advice and support from mortgage brokers. As the market continues to shift, staying updated on mortgage rate comparisons will be essential for making informed decisions.

    Frequently Asked Questions

    What factors are driving the increase in remortgaging among landlords?

    The increase is largely driven by the need for financial stability and better rates, with many landlords prioritising refinancing over new property purchases.

    How can landlords prepare for their next remortgage?

    Landlords should start planning their remortgage several months before their current deal expires and stay informed about current mortgage rates.

  • Paragon Launches New Bridging Finance Proposition

    Paragon Launches New Bridging Finance Proposition

    Paragon has announced the appointment of Sanders and Patel to spearhead the launch of its new bridging finance proposition, a move that signals the company’s commitment to diversifying its financial offerings. This initiative is particularly significant for intermediaries and borrowers looking for flexible financing solutions in the property market.

    TL;DR: Paragon has appointed Sanders as managing director and Patel as commercial director to launch a bridging finance proposition; this will provide new opportunities for intermediaries and borrowers in the UK property market.

    Who are the key figures behind this initiative?

    Sanders, who takes on the role of managing director of Paragon Bridging Finance, will lead the development of this new business segment. He is joined by Patel, who becomes the commercial director. Patel brings over 20 years of experience in specialist finance, having held senior positions at various financial institutions, including Together and Precise Mortgages. Their combined expertise is expected to drive the success of Paragon’s bridging finance offering.

    What is the timeline for the bridging finance launch?

    The bridging finance proposition will be piloted with a select group of intermediaries in the final quarter of 2026. Following this pilot phase, a full market launch is anticipated in 2027. This phased approach allows Paragon to refine its offerings based on feedback from initial partners, ensuring that the final product meets the needs of the market.

    What this means for intermediaries and borrowers

    This new bridging finance proposition is poised to create significant opportunities for intermediaries already engaged with Paragon for buy-to-let or development finance. As the market evolves, intermediaries will benefit from a more agile and committed bridging finance option backed by a FTSE 250 lender. Borrowers seeking quick financing solutions for property transactions will find this development particularly beneficial, as bridging finance can provide the necessary funds to secure properties in competitive markets.

    How does this fit into Paragon’s broader strategy?

    The launch of the bridging finance proposition is part of Paragon’s wider diversification strategy. By expanding its product range, Paragon aims to cater to a broader audience and enhance its market presence. This strategic move not only strengthens Paragon’s position in the financial services sector but also aligns with the increasing demand for flexible financing options in the property market.

    Frequently asked questions

    What is bridging finance?

    Bridging finance is a short-term loan used to bridge the gap between the purchase of a new property and the sale of an existing one. It is commonly used in property transactions where quick access to funds is required.

    Who can benefit from Paragon’s new bridging finance offering?

    Intermediaries working with buy-to-let or development finance clients, as well as borrowers looking for quick financing solutions in property transactions, can benefit from Paragon’s new bridging finance proposition.

  • Weaker Mortgage Market Demand Amid High Borrowing Costs

    Weaker Mortgage Market Demand Amid High Borrowing Costs

    The UK mortgage market is experiencing a notable decline in demand, driven by elevated borrowing costs and affordability challenges. Stonebridge’s recent report highlights an 18.5% year-on-year drop in mortgage applications for the second quarter of 2026, indicating a significant cooling in market activity.

    TL;DR: Mortgage applications fell 18.5% year-on-year in Q2 2026, impacting borrowers and first-time buyers; remortgaging remains a key focus as rates rise.

    Why Are Mortgage Applications Declining?

    Several factors contribute to the weakened demand in the mortgage market. The average mortgage rate surged to 4.97% in Q2 2026, up from 4.31% in the previous quarter and 4.74% a year prior. This increase has made borrowing less affordable, leading to a 20.8% decline in remortgage applications and a 15.5% drop in purchase applications. First-time buyers are not exempt, with their applications also down by 15.7%.

    What Do the Latest Figures Reveal About the Mortgage Market?

    Stonebridge’s Mortgage Market Index shows that the average loan amount across all mortgages decreased by 1.8% to £209,932. In contrast, first-time buyers borrowed an average of £216,984, reflecting a 1.5% increase compared to the previous year. The Bank of England reported that mortgage approvals in May were 10.8% lower than a year earlier, further underscoring the trend of decreasing demand.

    What This Means for First-Time Buyers

    For first-time buyers, the current market conditions present both challenges and opportunities. With the average mortgage rate climbing, affordability is becoming a pressing issue. However, the slight increase in the average loan amount for first-time buyers suggests that those who are able to secure financing are borrowing more. As remortgaging continues to dominate the market, first-time buyers may need to explore alternative financing options or consider waiting for more favorable conditions.

    What Should Borrowers Watch Next in the Mortgage Market?

    Borrowers should keep an eye on future interest rate movements and the overall economic environment. The share of borrowers opting for two-year fixed-rate deals has risen to 70%, indicating a shift in strategy as many seek to lock in lower rates amidst uncertainty. Additionally, geopolitical tensions and fluctuating oil prices could further impact mortgage funding costs, making it essential for borrowers to stay informed. For current rates, check the current mortgage rates.

    Frequently asked questions

    How can I find the best mortgage rates?

    To find competitive mortgage rates, consider using a mortgage rate comparison tool to evaluate different lenders and products based on your financial situation.

    What should I do if I can’t afford my mortgage payments?

    If you’re struggling to afford your mortgage payments, contact your lender immediately to discuss potential options, such as remortgaging or restructuring your loan. Seeking advice from a financial advisor can also be beneficial.

  • Impact of Student Loans on Your Mortgage Options

    Impact of Student Loans on Your Mortgage Options

    Understanding how student loans affect your mortgage application is essential for prospective buyers. As student debt continues to rise, mortgage lenders are increasingly focused on monthly repayment amounts rather than total debt. This shift in assessment criteria is important for first-time buyers looking to secure a mortgage while managing their student loans.

    TL;DR: Mortgage lenders prioritize monthly student loan repayments over total debt amounts; this affects how much first-time buyers can borrow.

    How Do Mortgage Lenders View Student Loan Repayments?

    When assessing your mortgage application, lenders are primarily concerned with your affordability. This means they focus on the amount deducted from your salary each month for student loan repayments rather than the total outstanding debt. For example, whether you owe £10,000 or £60,000 in student loans is less significant than the monthly repayment amount.

    What Should Borrowers Know About Student Loans and Mortgages?

    It’s important for borrowers to understand that the impact of student loans on mortgage eligibility can vary significantly between lenders. Each lender has its own criteria for assessing affordability, which means that the effect of student loan repayments on your borrowing potential can differ based on your overall income and expenditure. While student loan repayments are a recognized outgoing expense, the specific impact on your mortgage application will depend on individual circumstances.

    What This Means for First-Time Buyers

    For first-time buyers, the way student loans are viewed by lenders can greatly influence their ability to secure a mortgage. If your monthly repayments are manageable, you may still qualify for a mortgage, even if your total student loan debt is high. This is particularly relevant for younger buyers who may have substantial student debt but also have a stable income. Understanding this can help you prepare your finances accordingly and improve your chances of mortgage approval.

    How Can You Prepare for Mortgage Applications with Student Loans?

    To enhance your mortgage application, consider the following steps:

    • Calculate your monthly student loan repayments and ensure they fit within your budget.
    • Gather documentation of your income and expenses to present a clear picture of your financial situation to lenders.
    • Shop around for lenders to find those with the most favorable criteria regarding student loans.
    • Consider using a mortgage calculator to estimate how much you can borrow based on your income and existing debts.

    By being proactive and informed, you can navigate the mortgage process more effectively, even with student loans in the mix.

    Frequently Asked Questions

    Do all lenders treat student loans the same way?

    No, each lender has different criteria for assessing student loans. While most recognize them as a regular outgoing expense, the specific impact on your borrowing capacity can vary.

    Can I still get a mortgage if my student loan repayments are high?

    Yes, if your monthly repayments are manageable and your overall financial situation is strong, you can still qualify for a mortgage, regardless of the total amount of student debt.

  • Commercial Mortgage Lending Set to Exceed £1 Billion by 2026

    Commercial Mortgage Lending Set to Exceed £1 Billion by 2026

    The semi-commercial mortgage sector is poised for significant growth, with lending expected to surpass £1 billion by the end of 2026. This surge is driven by an increase in transaction volumes and average loan sizes, indicating a robust demand for semi-commercial properties in the UK.

    TL;DR: Semi-commercial mortgage lending reached £242 million in Q2 2026, a 20% increase from last year; landlords and investors should prepare for continued growth in this sector.

    What is driving the growth in semi-commercial mortgage lending?

    According to recent data, the semi-commercial mortgage market has seen a remarkable increase in lending, with £242 million completed in the second quarter of 2026 compared to £201 million in the same period last year. This represents a 20% growth, highlighting a strong demand for properties that blend residential and commercial uses. The increase in transaction volumes, estimated to have risen by 13% from 415 completions in Q2 2025 to 470 in Q2 2026, further underscores this trend.

    How are average loan sizes changing?

    Average loan sizes in the semi-commercial sector have also seen a notable increase, rising from £484,000 to £515,000 year on year. This 6% growth in loan sizes has contributed to the overall increase in lending value, suggesting that borrowers are seeking larger amounts to finance their investments in semi-commercial properties.

    What does this mean for landlords and investors?

    The growth in semi-commercial mortgage lending presents a significant opportunity for landlords and investors. With the number of active lenders increasing from 25 to 28 over the past year, and the variety of dedicated semi-commercial and mixed-use mortgage products rising by almost 20% to 94, borrowers now have more options than ever. Additionally, average loan-to-value ratios have increased from 64% to 67%, making it easier for investors to secure financing.

    Challenger banks and specialist lenders are at the forefront of this growth, offering competitive rates that range from approximately 6.0% to 9.0% based on the asset type and transaction complexity. This competitive environment is likely to benefit borrowers seeking semi-commercial mortgages as lenders vie for business.

    What are the implications of rising interest rates?

    As the market evolves, the average headline fixed rates for semi-commercial mortgages have eased slightly to around 6.70%, down from 6.85% earlier in 2026. However, borrowers should remain vigilant as rates from challenger and specialist lenders can vary significantly. TAB’s own variable-rate product is currently priced at Bank Rate plus 3.5 percentage points, equating to a rate of 7.25%. Investors should keep an eye on these interest rates, as they can impact overall borrowing costs and investment returns.

    Frequently asked questions

    What types of properties qualify for semi-commercial mortgages?

    Semi-commercial mortgages are typically secured against properties that have both residential and commercial uses, such as mixed-use developments where retail or office space is combined with residential units.

    How can I find the best semi-commercial mortgage deals?

    To find the best semi-commercial mortgage deals, consider consulting with a mortgage broker who specializes in commercial lending. They can provide insights into the latest products and rates available from various lenders.