New figures reveal trouble with mortgages

Around 1.5m mortgage borrowers may struggle to find a new deal once their deals come to an end, new figures show.

Equifax, the credit reference agency, reveal that many people with homeowner debt will be forced onto their current lender’s Standard Variable Rate (SVR) as other lenders' deals will not be available to them.

This is because with the onset of the recession, many firms have insisted that homeowners put down a greater deposit or more equity when remortgaging. This is an expense that fewer people can afford.

However, Equifax's Neil Munroe suggests that before looking at a new mortgage deal, homeowners could help their cause by making sure their credit rating is clean, by clearing county court judgements (CCJs), for example.

Kevin Still, director of Atlantic Financial Management says: "It's not only the fact that lenders have tightened loan-to-value (LTV) criteria on a property that's now valued at a lower amount, but they're also more selective.

"Any impairment on your credit file will be scrutinised, so Atlantic would encourage clients check their own file before getting re-mortgaging quotes either direct or through a financial advisor. Any debt problems or over borrowing are likely to count against you."

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