Several factors are coming together that are making the outlook for home borrowers a bit bleak. For home buyers it will be very difficult to obtain lending. For those seeking a remortgage it looks like now is the time to contact a broker or a lender.

The house market is being flooded by more and more homes being put up for sale. As supply increases and demand falls, home prices and home values will fall. When values fall the equity a homeowner has built drops as well. If a homeowner waits to remortgage after prices fall they are losing out on money that was available earlier. Pricewaterhouse Coopers predicts that house prices may not regain their 2007 peak value until 2015.

The Consumer Price Index (CPI) which stands at 3.2 per cent for June is still above the governments goal of 2 per cent. The CPI has been above 3 per cent for 7 months and with the Budget cuts is expected to rise again. A rise in inflation will call for an increase in interest rates.

Lenders are tightening up on property lending. First time buyers are being required to provide 30 per cent deposits on the average. Remortgage borrowers are being required to have higher percentages of equity. In addition, new FSA regulations are abolishing self-certified mortgages. Now lenders will have to show proof of income. This will make it harder on groups such as younger borrowers and the self-employed to obtain lending.

With all of these factors and the possibility of losing equity and paying higher interest rates someone considering a remortgage should obtain advice from a broker or lender now. The same advice goes for a first time buyer as these factors will have a negative impact on that group as well.