Mortgage ‘fire sales’ – where specific loans are only available for up to 48 hours – will become the norm over the next few months, say experts.
Such offers are a growing trend in an industry struggling to cope with buyer demand while suffering from staff shortages as a result of coronavirus issues.
These short-lived mortgages tend to be at the higher loan-to-value end of the market, which has seen a dramatic reduction in products available.
‘Fire sale’: Such offers are a growing trend in an industry struggling to cope with buyer demand while suffering from staff shortages as a result of coronavirus issues
It means lenders can get swamped with applications. TSB, Coventry Building Society and Accord have all offered fire sale mortgages in recent weeks.
David Hollingworth, of loan broker L&C Mortgages, says: ‘This may seem like an old-fashioned ‘get ’em while you can’ marketing gimmick to stoke up interest, but ironically it’s driven by a lender’s need to manage the amount of business that comes its way.’
Nick Morrey, of broker John Charcol, says: ‘I think we’ll see more flash sales before the end of the year. Rumours suggest that those lenders who have held them received five times the normal amount of applications and I think there’s growing pressure on other lenders to do the same.’
Morrey says it is hard for home buyers to keep up to date with what is available and advises them to speak to a mortgage broker. ‘With gazumping, bidding wars and a backlog of applications, you want to be able to move fast.’