ROOF Blog

Researchers at Durham University have found many homeowners are remortgaging their homes for cash to supplement their day-to-day expenditure. The researchers looked at the spending patterns of more than 8,000 families from 2001 to 2005 and found a third of people used the cash released by equity in their homes for ‘other specified reasons’, ie as a form of ‘self-administered welfare’ rather than on luxuries or home improvements. A spokesperson said that the clampdown on lending by banks and the collapse in property values was a welfare disaster for struggling households.

From April, homeowners will not be allowed to put their home on the market until all the key documents are in the home information pack, including a new property questionnaire. Currently sellers can start marketing their property as soon as they have commissioned a pack and for up to 28 days before they receive the pack. The property questionnaire will include information on flood risks, the safety of gas and electrical supplies, service charges, structural damage, and parking arrangements.

The Financial Services Authority wants to force banks and building societies to pass on this week’s expected interest rate cuts on their tracker mortgages. Clauses in current agreements say cuts do not have to be passed when the base rate falls below 3 per cent, but the FSA has warned that the clauses maynot be enforceable. Around 4.2 million homeowners with tracker mortgages are hoping for reductions in their monthly repayments tomorrow, when the Bank of England’s monetary policy committee sets the base rate. Halifax, Nationwide and Abbey National are among lenders in the FSA’s sights.