Almost 1,000 mortgage deals pulled as panic grips UK housing market

theguardian.com:

Almost 1,000 mortgage packages were pulled overnight from the British market as panic seeps into the housing market in the wake of Kwasi Kwarteng’s mini-budget.

Moneyfacts, which monitors the sector, said 935 out of 3,596 mortgage products had disappeared between Tuesday and Wednesday, double the previous record of 462 at the start of the pandemic lockdowns.

The sudden shift is already threatening to stall the housing market, with borrowers saying they have been unable to secure loans or have had provisional offers withdrawn, while others are paying huge financial penalties to break their existing deals and in order to lock in fixed rates for longer.

From first time mortgagees in shared ownership to people on house loans worth millions of pounds, there is now a palpable sense of a personal finance timebomb, with markets predicting interest rates will almost triple from 2.25% to 6% next spring.

One mortgage broker said he had a wealthy client willing to pay £95,000 in a penalty charge for breaking a fixed-rate deal.

“He is two years into a five-year deal and unfortunately for him the early redemption charge is 5%,” said the broker.

At the other end of the scale is 68-year-old Glen Robinson who tried to remortgage his home to help finance the final stage of his divorce settlement.

He had agreed a rate of £160 a month but that has now collapsed.

“I will now probably be forced into a distressed sale to raise the money by the courts,” he said. “I’m 68 years old and face near certain fiscal ruin as a result of the chain of events unfolding.”

A 42-year-old software engineer househunting in Cambridge, who asked not to be named, said she had signed her application for a two-year fixed mortgage at 4.32% interest yesterday evening, less