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3 April 08 - Hello… Are there any mortgages out there???

If you have seen any news headlines lately, it seems not. You can’t pick up a newspaper or watch the news without finding out about the latest “crisis” in the mortgage market.

The latest panic seems to stem from the fact that First Direct has suspended its entire mortgage range and The Co-operative Bank has had to withdrawn its two-year mortgage deals. Moreover, lesser known names such as Southern Pacific and Preferred Mortgages have also stopped taking new business.

Why? Well you could be forgiven for wondering why they would stop taking business, but the shortage of funds in the banking system means some lenders are unable to cope with the demand. Banks such as First Direct were offering rates under 5% until they experienced a recent surge in demand.

So is there a real shortage or is it media hype? There is no doubt there are fewer deals available. At The Mortgage Shop, the number of deals we have access to has fallen by 40%. The good news is that we still have access to over 28,000 mortgage products!*

Of course, another way to deal with the demand is to increase rates and fees. In a harder market you can rest assured that UK lenders will do just that. Meanwhile lenders such as the Cheltenham & Gloucester are demanding that borrowers put down deposits worth at least 10% of a property's value.

This whole malaise is backed up by The Council of Mortgage Lenders (CML) who reported two weeks ago that the number of new mortgages being taken out by home buyers is at its lowest level for nine years.

So if you are a homeowner or want to get on the housing ladder, what do you need to do?

A BBC news report yesterday advised people to seek independent advice. The advantage of course is that we are able to search the whole market (even if it is shrinking) to find the right mortgage for you. With rates being suspended, withdrawn, increased and subjected to higher fees it makes even more sense to sit down with an independent adviser, have a cup of coffee and try to take some of the stress out of the process.

The Mortgage Shop the largest independent mortgage broker in the South West with 8 offices. The company has recently moved its Ivybridge branch to 19 Fore Street .

For more information feel free to pop in and see us at 18 Mannamead Road , Plymouth (01752 825900) or 19 Fore Street , Ivybridge (01752 698999) or visit us online at www.themortgageshop.com we’ll be happy to help.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

*correct at date of press release