Mortgage Strategy articles from April 2008

Mortgage Strategy archives from April 2008

COMMENT: Brokers see light in the darkness.
April 7, 2008... Last Monday's news that Lehman Brothers had suspended lending was another sign of how rapidly the UK mortgage market is contracting. The US lender has not confirmed what the future of Southern Pacific Mortgage Limited and Preferred...

PMS Q1 completions down 20%.
April 7, 2008... Mortgage Strategy can today unveil the full extent of the credit crunch with news that completions at Premier Mortgage Service plunged 20% in Q1 compared with the same period last year. Mortgage Strategy estimates that the value of the...

Halifax gets tough on loan deposits.
April 7, 2008... Halifax will penalise all borrowers who fail to stump up 25% deposits from today. The UK's biggest lender will add 0.14% to the product rate of borrowers taking out deals above 75% LTV. But the lender will also reward clients who put...

AfI aims for more offers via risk-based pricing.
April 7, 2008... Abbey for Intermediaries aims to offer nine out of 10 mortgage deals in the foreseeable future after switching to risk-based pricing. Clive Kornitzer, chief operating officer of AfI, stresses that the plan is tentative but adds that it...

Former Optoma chief in partnership talks.
April 7, 2008... Andrew Seymour, former chief executive of Optoma Mortgage Services, and Connect Mortgage Group are locked in negotiations about establishing a packaging partnership. Seymour thinks a combination of his experience, contacts and sales team...

IN BRIEF: Repossession fears grow.(Brief article)
April 7, 2008... Nearly 60,000 homes in the UK are at risk of repossession, government figures reveal. Data from the Housing statistics 2007 report, published last week by the Department for Communities and Local Government, show that almost 60,000 families...

IN BRIEF: House prices static in February.(Brief article)
April 7, 2008... The Land Registry says house prices in England and Wales remained static during February, with the average price standing at #185,616. Prices in London fell by 0.4%, with average house prices dropping to #353,760. But at 10.6%, annual growth in...

IN BRIEF: First Direct halts new lending.(Brief article)
April 7, 2008... First Direct has suspended new lending after applications soared to five times their normal volume. The lender says the suspension means it can focus on processing the backlog that has built up in recent weeks. Chris Pilling, chief...

IN BRIEF: Santander to buy RBS European arm.(Brief article)
April 7, 2008... Santander has agreed to buy the Royal Bank of Scotland's European consumer lending business, which provides credit cards and loans directly to borrowers in Germany, the Netherlands, Belgium and Austria. Copyright: Centaur...

NR processors may face axe.
April 7, 2008... Northern Rock staff processing further advances and remortgages could become victims of the bank's redundancy programme, the bank's former finance director claims. NR, which was nationalised in February, plans to reduce its 6,000- strong...

64% of brokers have reviewed their PI deals.
April 7, 2008... A whopping 64% of Mortgage Strategy Online readers have reviewed their professional indemnity policies in the past six months. Just 36% have neglected to do so despite some PI insurers revising their exemptions. Copyright: Centaur...

Cool reception for mortgage review.
April 7, 2008... Two of the Industry's key trade bodies have lambasted The Financial Services Authority for the unsurprising outcome of the second stage of its Mortgage Effectiveness Review. In findings published last week, the FSA revealed that brokers...

Mark Blackwell laid off after six months at A&L.
April 7, 2008... Mark Blackwell has been made redundant from his role as director of intermediary sales at Alliance & Leicester after just six months in the job. A spokeswoman for A&L says the decision is the result of a senior management review within...

Stock Picker: 07.04.08.
April 7, 2008... Financial shares enjoyed another good week as confidence slowly returned to the market. Friends Provident was in the spotlight as the group rejected a takeover approach from JC Flowers, the private equity firm interested in purchasing...

IN BRIEF: UK borrowers think long-term.(Brief article)
April 7, 2008... A financial services website says that more than a third of UK borrowers would opt for 25-year fixed rate mortgages. A poll by FairInvestment.co.uk shows 37% would opt for 25-year fixed rate mortgages and a further 28% would choose medium-term...

AMI lobbies for individual registration.
April 7, 2008... The Association of Mortgage Intermediaries is campaigning for individual registration to prevent fraudsters entering the broker market. At the Mortgage Product Positioning and Development Conference held in association with Mortgage...

Stamp Duty relief slammed by MPs.
April 7, 2008... The government is under fire from a parliamentary committee for failing to extend Stamp Duty relief for zero-carbon properties to existing homes. The criticism follows chancellor Alistair Darling's Budget announcement last month that...

Mutuals see savings boom.
April 7, 2008... Building societies recorded a whopping #1.35bn in savings business in February - the largest inflow the sector has seen for 11 years. Figures published by the Building Societies Association last week show that the February figure compares...

Overhaul banking system, says BoE.
April 7, 2008... The Bank of England is calling for an overhaul of the banking system in light of the liquidity crisis. Paul Tucker, head of markets at the BoE, has called for a revamped regulatory approach to banking that reflects the global nature of...

Sales advice online.
April 7, 2008... Senior advisers at Thinc Group are giving masterclasses on sales techniques on the IFA network's online show ThincTV. Thinc says the objective is to help its appointed representatives capitalise on the skills of its most successful...

IN BRIEF: Co-op profits fell by #26m last year.(Brief article)
April 7, 2008... Co-operative Bank saw a #26m decline in its operating profits last year after being forced to write down #31.8m worth of investments. The bank's results for 2007 show pre-tax profits dropped to #50.4m from #76.3m in 2006. Excluding...

IN BRIEF: HML makes sales appointment.(Brief article)
April 7, 2008... Mike Perry, former director of sales at Amber Homeloans, has been appointed director of sales and marketing at Homeloan Management with effect from April 14. Copyright: Centaur Communications Ltd. and licensors

IN BRIEF: KRS joins equity release panel.(Brief article)
April 7, 2008... Key Retirement Solutions has joined The Mortgage Times Group's lifetime mortgage panel. It gives brokers access to exclusive products including cash reserves and drawdown facilities. The panel also incorporates a no negative equity guarantee...

Paragon staff down by 30%.
April 7, 2008... Paragon Group last week confirmed that it has reduced its staff by a third. This follows the transfer of new business processing from its intermediary-focussed buy-to-let arm Mortgage Trust from Epsom to Solihull. The news comes...

UNIFi upgrades its loans portal.
April 7, 2008... UNIFi Partners has upgraded its secured loans portal following revisions to the Consumer Credit Act. Until April 6 the legislation only applied to loans up to a maximum of #25,000 but it now covers all secured lending. The reformed...

Network Data vows to grow.
April 7, 2008... Network Data Group has pledged to grow its business and play a central role in any future consolidation among mortgage networks. This is despite revealing a #1.1m pre-tax loss in its 2007 full-year results last week, compared with a...

Learn more about bridging finance.
April 7, 2008... Specialist lender Tiuta is to host a bridging finance training seminar for brokers on April 9. It will explore the use of bridging loans as a funding option, the loan application process and issues surrounding compliance. Gary Booth,...

IN BRIEF: M-Next unveils self-cert deal.(Brief article)
April 7, 2008... Mortgage Next Packaging has launched a prime self-cert range via Kensington Mortgages, available up to 90% LTV. Two-year fixed rates are available at 7.25%, three-year fixed rates at 7.15% and two-year trackers at 7.24% or 1.99% above the base...

IN BRIEF: Payment shock clients get advice.(Brief article)
April 7, 2008... The 1.4 million borrowers likely to face higher mortgage costs this year as a result of payment shock will be offered advice by the Money Advice Trust and the Council of Mortgage Lenders. Supported by the House of Commons, MAT has been working...

IN BRIEF: Competition targets brokers.(Brief article)
April 7, 2008... The Mortgage Alliance and Loanmakers have announced an exclusive competition for members to win a five-star hotel and theatre break in London. To qualify, brokers need to submit a lead to Loanmakers between April and June. Copyright:...

Another round of product and rate changes.
April 7, 2008... Brokers were faced with another surge of product changes last week as lenders strived to balance service standards with spiralling business volumes and funding costs. Woolwich kicked off the changes last Monday. It withdrew a range of...

BDS Secured Loans extends 10% proc fee promise.
April 7, 2008... BDS Secured Loans has extended its pledge to pay brokers an extra 10% commission on all deals received by April 30. The firm, which launched last September, already offers brokers half of the case income it receives after costs. Mark...

IN BRIEF: Agents lose faith in housing market.(Brief article)
April 7, 2008... Estate agents' confidence in the housing market plummeted last month, according to HotProperty.co.uk's confidence index. This reveals a 22% fall in confidence among agents in March compared with February. Shawn Luetchens, managing director...

IN BRIEF: Pink offers proc fee bonus.(Brief article)
April 7, 2008... Pink Home Loans is offering brokers the chance to earn bonus proc fees. Brokers who use Pink's online sub-prime decision in principle facility before April 25 and then submit their cases to its packaging team will receive an extra #100 when...

IN BRIEF: Deposit scheme disputes are rare.(Brief article)
April 7, 2008... A tenancy deposit scheme has recorded just 341 disputes among its 200,000 accounts. Mydeposits.co.uk says the 200,000 figure represents more than #177m worth of deposits protected by some 31,000 landlords and letting agents. Copyright:...

What could the government do to restore public confidence in banks?
April 7, 2008... Last week the Confederation of British Industry warned that mistrust between banks is now worse than it was last autumn. The warning comes amid continuing turmoil in the banking sector and government preparations to unveil changes to the...

Yorkshire named best value lender of Q1 2008.
April 7, 2008... The Yorkshire was the most competitive mortgage lender in Q1 2008, according to Mform.co.uk. The price comparison website says Furness was in second place, while Chorley and West Bromwich came in joint third. But Mform.co.uk says big...

ANALYSIS: Market watch - 07.04.08.
April 7, 2008... Swaps inched their way down last week but this had no effect on the race for the worst buys. * One-year money is down 0.12% at 5.49% * Two-year money is down 0.14% at 5.13% * Three-year money is down 0.13% at 5.07% * Five-year...

ANALYSIS: Have HIPs improved the property buying and selling process?
April 7, 2008... Our experts are split, with one saying HIPs have resolved several problems and the other maintaining they are a waste of time and money Karen Babington is sales and marketing director at Easier2Move Despite the content of Home...

ANALYSIS: FSA regulation is a funny old game.
April 7, 2008... Soon after the late and not so great Robert Maxwell met his briny fate, my son bought me a delightful board game that provided me with hours of schadenfreude. Called Maxwell, it was much like Snakes and Ladders. There were dice and...

ANALYSIS: Tide of repossessions allowed to rise.
April 7, 2008... If ever there was a time that consumers needed protection from bullying lenders eager to evict them, it is now. And if there was a time those struggling with repayments needed to be treated with dignity, it is now. But it seems lenders have...

ANALYSIS: Mortgage advice is a specialised case.
April 7, 2008... The Thoresen review of generic financial advice was published last month and recommended the establishment of a national money guidance service. It was accompanied by the Treasury's announcement of a #12m pathfinder programme to help...

ANALYSIS: IF's spin doctors fail to convince me.
April 7, 2008... I accept there's a hint of hypocrisy here given I've spent many years as a corporate spin doctor, but I had to smile at Intelligent Finance's recent email to brokers that put a positive gloss on negative news. In a nutshell, it wants...

ANALYSIS: We must strive to keep brokers afloat.
April 7, 2008... Over the past few weeks the mortgage market has been contracting on what feels like a daily basis. Deals are disappearing at a rate of knots and there are fewer lenders lending. We've calculated that the liquidity crisis and the resulting...

ANALYSIS: School of Sales will bring in fresh blood.
April 7, 2008... In football a good manager must strike a balance between having experienced hands guiding the team and bringing in new players to add an extra dimension. They also need trainees willing to learn the ropes to ensure the team remains strong in...

ANALYSIS: Get answers straight from FSA's mouth.
April 7, 2008... Regular readers of this column will know that I am happy to stand up to the regulators when they get things wrong. Many small brokers are worried about openly criticising organisations such as the Financial Services Authority and Financial...

ANALYSIS: Arrears crisis is only a matter of time.
April 7, 2008... When the liquidity crisis began I suggested it might lead to an arrears crisis. This seems increasingly likely as more products disappear from the market. I've talked to a number of brokers who want lenders to restore confidence by...

ANALYSIS: Weighing up the benefits of grants.
April 7, 2008... Continuing my theme of grants from last week, I'd like to remind readers of the Financial Services Authority's requirements when considering the suitability of equity release transactions. MCOB 8.5.4 states that once a broker has...

ANALYSIS: An example of partnership paying off.
April 7, 2008... Partnership - there's a word that's often abused in the mortgage industry. My pocket dictionary defines partnership as a joint venture between two parties and at the moment, balance sheet lenders are under fire over how they are dealing with...

MPC: Shadow MPC.
April 7, 2008... A conviction that the risk of a serious economic slowdown outweighs that of an inflationary spiral leads the Mortgage Strategy GE Money Home Lending Shadow Monetary Policy Committee to call for another 0.25% cut in the base rate this month ...

LETTER: Clients should be contacted sooner rather than later.(Letter to the editor)
April 7, 2008... From Simon Collis I take exception to your columnist Julian Wells saying it is a worrying development that brokers are contacting their clients months before their deals come to an end (Mortgage Strategy March 31). I'd say it's at...

LETTER: I'm proud to keep clients updated on the market.(Letter to the editor)
April 7, 2008... From Danny Lovey My blood boiled when I read Julian Wells' patronising article last week. Who is he to preach about brokers putting borrowers first? It seems his claim to this wondrous revelation is that there's more administration...

LETTER: Time for government to consider innovative solutions.(Letter to the editor)
April 7, 2008... An open letter to chancellor Alistair Darling from Rachel Bancroft In just nine months the once-thriving sector of mortgage lending has been brought to its knees by global investors losing confidence in mortgage-backed securities. ...

LETTER: First Active's policy used to be clear, but not any more.(Letter to the editor)
April 7, 2008... From Scott Swift I'm writing to express my dissatisfaction and frustration after finding out that First Active has changed its retention strategy the hard way. First Active has been around for a few years and I have always thought...

LETTER: RBS system delays messed up a straightforward case.(Letter to the editor)
April 7, 2008... From John Smith I sympathise with Dan McGeehan in his letter about First Active (Mortgage Strategy March 24) although my recent beef is with the Royal Bank of Scotland on a straightforward purchase case. I don't understand how RBS can...

LETTER: Banks' contempt for their lifeblood is astonishing.(Letter to the editor)
April 7, 2008... From Dave Rogers We've recently seen banks reduce their staffing and service levels while boosting salaries and bonuses at the top. The liquidity crisis has seen them increase their margins and I hear one large lender is to cut proc...

LETTER: We must support the police and kick out fraudsters.(Letter to the editor)
April 7, 2008... From Vic Jannels The recent announcement that the Metropolitan Police is to appoint 50 specialists to focus on mortgage fraud is a poor reflection on the state of our industry. Most practitioners are of a high calibre and honest but...

LETTER: Met had to get involved because of lenders' apathy.(Letter to the editor)
April 7, 2008... From Gary Booth The fact that the Met is to appoint 50 investigators to focus on mortgage fraud reflects the industry's failure to keep its own house in order. What surprises me is the apathetic way some lenders have approached the...

LETTER: FSA flops feather their nests while the industry suffers.(Letter to the editor)
April 7, 2008... From Warwick Tidy Tiner - #325,000 gardening leave. Briault - #380,000 for failing. Is the FSA treating itself fairly in tough times? What a disgrace. Warwick Tidy Warwick Tidy Mortgage Services By email Copyright: Centaur...

HANDY SUM: Bucking the trend.
April 7, 2008... Equity release sales slipped last year thanks to the liquidity crisis but the market remains in good shape and brokers will benefit from continuing demand for such products, says Harvey Jones The liquidity crisis has sunk its teeth into...

Competition hots up thanks to new entrants.
April 7, 2008... Nigel Hare-Scott is managing director of Home & Capital Advisers It's reassuring to note that amid the doom and gloom surrounding the mortgage market the equity release sector is bucking the trend. While the Bank of England reports that...

Equity release offers clients long-term value.
April 7, 2008... Colin Franklin is managing director of Godiva Mortgages The equity release market is entering an interesting stage. The surge in house prices experienced over the past decade coupled with an ageing population and limited pension provision mean...

FEATURE: Full steam ahead.
April 7, 2008... Lenders are on track to implement the Treating Customers Fairly initiative as long as difficult market conditions don't derail them, says Peter Williams At the end of last month, firms regulated by the Financial Services Authority had to...

COMMENT: Landlords confident about B2L future.
April 7, 2008... There are mixed signs about the state of the buy-to-let sector but ARLA's research into landlord sentiment shows that 90% of them are in it for the long haul, says Mel Dring Buy-to-let is one of the most scrutinised sectors of the mortgage...

COMMENT: Brokers must remind landlords to comply with Scheme.
April 7, 2008... If all is well with the buy-to-let market, the same cannot be said for the government's Tenancy Deposit Scheme. It specifies that landlords must protect their tenants' deposits using one of three authorised schemes but research reveals that...

COMMENT: Steady as she goes for AR numbers.
April 7, 2008... There has been little change in the total number of ARs in mortgage networks so far this year, although a couple of players have ambitious expansion plans, says Richard Griffiths The table below shows appointed representative firms in...

COMMENT: Working life is frustrating for brokers.
April 7, 2008... The FSA's decision to add another layer of red tape to the regulatory system is a symptom of why much of the joy has gone out of working in the financial services industry, says Sue Read The Financial Services Authority has admitted that...

COMMENT: Good intentions behind council estates.
April 7, 2008... Social housing was a result of the vision of a remarkable Victorian lady who was horrified by the living conditions in London's tenement blocks, says Simon White There are a variety of views on the virtues or otherwise of council...

COMMENT: Leading questions in a time of crisis.
April 7, 2008... Lead generation companies are in the spotlight as an increasing number of desperate consumers seek advice but brokers should use them with caution, says Sally Laker In the current challenging mortgage market, brokers are finding it tough...

COMMENT: Cutting fees would be short-sighted.
April 7, 2008... It would be unwise for lenders to cut brokers' proc fees because they would find alternative ways of drumming up business considerably more expensive, says Mark Harris There are rumours that some lenders are considering cutting the proc...

DEAR DELIA: Consultant wants to buy property for #800,000.
April 7, 2008... My client is a consultant at an NHS hospital but recently started his own private practice in orthopaedics. He wants to buy a property for #800,000 and will have #250,000 equity from the sale of his current home. His local bank has declined...

COMMENT: Batten down for a complaints storm.
April 7, 2008... The FOS is worried about the rising number of mortgage-related complaints and this trend could be about to accelerate so brokers must ensure their processes are compliant, says Bill Warren The subject of mortgage-related complaints was...

Roger's Round Britain Rambles: Manchester.
April 7, 2008... Manchester - did you know? 1. Manchester was the world's first industrialised city and played a central role in the Industrial Revolution. 2. The city was the home of the world's first computer. 3. The Co-operative Group, the...

CurriculumVitae: Clare Bettelley.
April 7, 2008... Name: Clare Bettelley Age: 33 Company: The Negotiator Job Title: Editor Where do you live? Surrey Quays Describe your current job: I'm the editor of The Negotiator, a fortnightly magazine for those who work for...

COMMENT: At last, an effort to resolve the crisis.
April 14, 2008... Although the weather has been topsy-turvy for the past six months, a permanent storm cloud has been hanging over the mortgage market. But after rain comes sunshine and last week, the pasty faces of workers in the industry finally caught...

CML calls on BoE to spearhead global recovery.
April 14, 2008... The Council of Mortgage Lenders is urging the Bank of England to lead a global action plan to alleviate financial market turmoil. Steven Crawshaw, chairman of the CML, made the plea last Friday at the trade body's annual lunch at the...

Rate Matcher deal branded a gimmick.
April 14, 2008... Borrowers are likely to be left confused and disappointed by HSBC's Rate Matcher range. This is the view of Scott Coghill, director at CompliancePoint, who says the offer is too good to be true. Coghill says the deal is open to far...

L&G club's DA brokers see business rise 33%.
April 14, 2008... Legal & General has revealed that completions by its mortgage club's directly authorised brokers were up 33% in Q1 2008 compared with the previous quarter. L&G says that in light of current challenges, brokers are taking advantage of...

IN BRIEF: G7 meets to discuss crisis.(Brief article)
April 14, 2008... The G7 group of industrialised nations met at the weekend to discuss ways of tackling the global credit crisis. The agenda included talks on the transparency of banks' exposure to risk, rules concerning credit ratings and the role of central...

IN BRIEF: A&L to cut its SVR by 0.25%.(Brief article)
April 14, 2008... Alliance & Leicester is to cut its SVR by 0.25%. This change will come into effect on April 23 for new borrowers and on May 2 for existing mortgage holders. Copyright: Centaur Communications Ltd. and licensors

IN BRIEF: Accord pulls deals at short notice.(Brief article)
April 14, 2008... Accord Mortgages has pulled its prime fixed and tracker rates in response to high business volumes. The lender says it gave brokers only 90 minutes' notice to avoid a spike in mortgage applications. Copyright: Centaur Communications Ltd....

IN BRIEF: Future in secured loans rumour.(Brief article)
April 14, 2008... Future Mortgages is rumoured to have temporarily halted its secured loans business. The Citigroup subsidiary is expected to make an announcement about the rumour this week. Copyright: Centaur Communications Ltd. and licensors

IN BRIEF: TMW pulls all products.(Brief article)
April 14, 2008... The Mortgage Works has pulled its entire product range. Nationwide's specialist lending arm says it took the decision to avoid climbing the best buy tables. Copyright: Centaur Communications Ltd. and licensors

IN BRIEF: Commercial First in consultation.(Brief article)
April 14, 2008... Commercial First has entered into a redundancy consultation with 50% of its staff - around 93 employees - after it suspended new lending last month. The lender says it hopes to return to the market soon but will have to reduce staffing...