Brexit Impact

The consequences of a Hard Brexit or No Deal Brexit are very uncertain.  Financial institutions may choose to overreact to the changes without knowing the exact outcomes.

Brexit impact on Mortgages and Secured LoansBrexit could have a material impact on the following types of UK Finance:

The reasons could be:

  • Increased volatility in interest rates
  • Increased volatility in foreign exchange markets
  • Deterioration of the UK economy and reduced government tax take leading to larger deficits
  • Risk of reductions in UK property values in both commercial and residential types
  • Capital flight from the UK
  • Fear of changes in regulatory issues with the departure from the certainty of EU regulations and oversight from the European Union
  • Financial crises caused by dropping out of EU rules (e.g. contracts validity, derivatives and 3rd party counter party risks)
  • Increased volatility in the stock market
  • Foreign investors with US Dollars, Euros or Asian currencies see pounds as too risky

Some outcomes could include:

  • Increased rates and fees
  • Shorter mortgage/loan terms
  • Removal of some mainstream lending products completely
  • Some of the lenders commonly used by Ravenwood Services that are more tolerant of bad credit and higher loan to values disappearing
  • Your existing lender maybe less willing to change terms or offer further advances

The advocates of leaving the European Union may argue that without being forced to take their rules and regulations, a reduction in regulation may make the costs of finance cheaper.