A broker said that it was never more important to be ready
The current situation is volatile(Image: Oscar Wong via Getty Images)
The average shelf-life of a mortgage plummeted to a record low of just eight days in March, down from 14 days in February, according to Moneyfacts — and a mortgage expert has urged borrowers to be ready to act at short notice or risk missing out. The previous lowest average lifespan of a mortgage was in July 2023, at just 12 days, the research from Moneyfacts showed.
Reflecting the massive uncertainty caused by the war in the Middle East, the average mortgage shelf-life is now even lower than what it was at the start of October 2022, when it was 15 days following the notorious Liz Truss ‘mini-Budget’ that had an unprecedented impact on mortgage choice and sent rates spiralling upwards.
One broker, Stephen Perkins, managing director at national mortgage broker, Yellow Brick Mortgages, said it had never been more important for anyone considering buying or remortgaging at present to have their ducks in a row.
He said: “The speed at which events in the Middle East are unfolding and the possibility of peace and a ceasefire one minute and a prolonged conflict and energy crisis the next, means lenders are pulling or repricing their products far more than normal. A product could become available on a Monday and, a week or so later, be gone altogether.
“That, for now at least, is the new normal. It’s therefore vital that borrowers are document-ready to ensure they can secure a rate before it may be pulled altogether.”
Stephen said documents people needed to have close to hand and ready to share with their broker included the last three months’ payslips and latest P60, if employed, or latest two years’ accounts and tax year overviews if self-employed.
He added that first-time buyers must have bank statements or other proof showing any savings towards their deposit, or a letter if their deposit has been gifted; three to six months of bank statements to show outgoings and spending habits were also key for borrowers, as well as proof of address and identity.
Stephen said: “I’ve never known a time when rates and products appear and then disappear so quickly. It’s a huge challenge for borrowers and we encourage all prospective buyers and those remortgaging to speak to their brokers ASAP to ensure that they have everything ready to secure a product while it’s still there.”
It’s worth noting that rates, with most lenders, can only be secured on application and, with a handful, at agreement in principle stage. In both cases, the rate will only be secured if the necessary documentation was in place.
Stephen added that failure to be document-ready could end up expensive if rates continue to rise, which nobody is ruling out.
He said: “To fail to prepare is to prepare to fail, and that has never been more pertinent than at present. One missing document can delay your application and mean you miss out on a rate that could save you hundreds or even thousands of pounds on your mortgage in the years ahead.
“It’s always been important to be organised when it comes to your mortgage, but that is the case more than ever in these highly volatile times.”