Mortgage Strategy articles from July 2007

Mortgage Strategy archives from July 2007

COMMENT: RDR spells trouble for small brokers.
July 2, 2007... There were two big events last week. The first was Gordon Brown's ascension from chancellor to Prime Minister and the second was the Retail Distribution Review. What they had in common - other than taking place on the same day - was to leave...

Website float will help brokers.
July 2, 2007... Moneysupermarket.com has promised that its floatation on the London Stock Exchange will help smaller brokers compete with big national brokerages. Last week, Moneysupermarket.com confirmed its intention to float, which came as no...

FSA accused of doublespeak on GI.
July 2, 2007... The Financial Services Authority's discussion paper on general insurance has been slammed for using double-speak and papering over the cracks in a poor product by extending the cancellation period for payment protection insurance. The...

Bogus payslips firm's top clients are brokers.
July 2, 2007... An online provider of bogus pay-slips has admitted to Mortgage Strategy that mortgage brokers are its biggest customers. Replicadocs.co.uk enables people to order and pay for fake documents such as payslips, utility bills and bank...

IN BRIEF: US storm hits Finegold fund.(Brief article)
July 2, 2007... Kensington Mortgages founder Martin Finegold has closed a #450m fund invested in US sub-prime mortgage debt as a result of the US sub-prime crisis. Finegold, former chief executive officer of Trigold, set up London fund manager Cambridge...

IN BRIEF: PTFS launches self-cert exclusive.(Brief article)
July 2, 2007... Personal Touch Financial Services has launched an exclusive self-cert two-year tracker funded by Platform and available for purchase and remortgage cases through Mortgagebox. The self-cert product is available up to 90% LTV with rates from...

IN BRIEF: Gordon Brown picks his team.(Brief article)
July 2, 2007... Prime Minister Gordon Brown put his stamp on his government last week with the reshuffle of the Cabinet. Alistair Darling takes over as chancellor while Hazel Blears replaces Ruth Kelly as communities secretary. Housing minister Yvette Cooper...

IN BRIEF: Future offers 100% LTV secured loans.(Brief article)
July 2, 2007... Future Mortgages has confirmed it will enter the 100% LTV secured loans market with a range of products due to be launched later this week, but declined to give details. Copyright: Centaur Communications Ltd. and licensors

IN BRIEF: Advantage rolls out B2L range.(Brief article)
July 2, 2007... Advantage has rolled out its buy-to-let product range to The Mortgage Operation, Praxis, Exclusive Connections, BDS Mortgage Group, Mortgage 1 and Pink Home Loans. The range offers 90% LTV and 100% rental cover deals. Borrowers can take...

IN BRIEF: HBOS chairman to keep going.(Brief article)
July 2, 2007... HBOS chairman Dennis Stevenson will continue in the role for a further three years when his term comes to an end in June 2008. Stevenson was appointed as a director of Halifax in May 1999 and became chair in July that year, a position he...

IN BRIEF: Mutual reveals healthy results.(Brief article)
July 2, 2007... Scarborough has revealed a 20% increase in pre-tax profits. It reports profits of #6.8m and a 33% increase in total group assets to a record #2.3bn. Group mortgage balances were up 4% to #1.4bn. Copyright: Centaur Communications Ltd. and...

UK braced for flipping fraud.
July 2, 2007... Fraud specialist Haymarket Management Services has urged the mortgage industry to be wary of fraudsters trying to 'flip' properties for a profit. Flipping is a phenomenon sweeping the US where criminal gangs including mortgage brokers...

MS Online readers slam Whitehall HIP ad spend.
July 2, 2007... News that the government spent #82,335 on advertising Home Information Packs has outraged Mortgage Strategy Online readers. A whopping 84% of them believe the spend was unjustifiable, with just 16% thinking it was the right amount. ...

Virgin considers market comeback.
July 2, 2007... Virgin Money has confirmed it is looking at re-entering the mortgage market in 2008 with broker and consumer-facing operations. Ever since Jayne-Anne Gadhia quit as managing director of consumer finance at Royal Bank of Scotland and...

Mortgage world left high and wet by flood.
July 2, 2007... Members of the mortgage industry were left high and wet this week as freak flooding hit parts of the UK. Leeds-based Julian Wells, outgoing head of marketing at Mortgages PLC, says: "I had to bail water out of my garden to stop the house...

Brokers slam lenders' premium rate helplines.
July 2, 2007... Brokers have hit out at lenders that use expensive 0870 and 0845 intermediary helpline numbers. The government has said it will scrap premium rate numbers next year but brokers want lenders to change their numbers now. Simon Chalk,...

Capital One commits to UK market.
July 2, 2007... Capital One Financial Corporation has scotched market speculation that it plans to pull out of the UK market but admits that some 2,000 job cuts are imminent across the business worldwide. Last week, the loan, mortgage and credit card...

IN BRIEF: Good news for beleaguered HIPs.(Brief article)
July 2, 2007... The Department for Communities and Local Government has revealed there are now 1,340 accredited energy assessors - up from 520 in May and a step closer to the 3,000 needed to introduce Home Information Packs to the whole market. The...

IN BRIEF: Website demands family homes.(Brief article)
July 2, 2007... SmartNewHomes.com has called on Prime Minister Gordon Brown to build more houses to help young families get a foothold on the property ladder. The property website says that in 1997 74% of the new homes built in the UK were houses while 26%...

High LTV from the Yorkshire.
July 2, 2007... The Yorkshire has joined the growing list of lenders offering high LTV products with the launch of Mortgage+, a 115% LTV offset product. Mortgage+ has no application fee or higher lending charge. It is available as a tracker priced at base...

MPLC takes flak for fees and services.
July 2, 2007... Mortgages PLC has come under fire for hitting packagers and brokers with a double whammy of poor service and slashed proc fees. Earlier this month, the lender admitted that economic conditions had forced it to slash its proc fees for both...

AMI says RDR is bigger threat than regulation.
July 2, 2007... Chris Cummings, director-general of the Association of Mortgage Intermediaries, has warned the industry that the Retail Distribution Review poses a bigger threat than regulation. Last week, the Financial Services Authority outlined proposed...

IN BRIEF: London prices still lead the field.(Brief article)
July 2, 2007... Land Registry figures show the average house price in London hit #335,658 in May, while the average price in England and Wales was #180,594. The rate of increase in house prices in London remains more than 6% above the average for England and...

IN BRIEF: Advantage tops RAMP league.(Brief article)
July 2, 2007... Advantage has taken top spot in a lender league table compiled by the Regulatory Association of Mortgage Packagers for May. John Rice, managing director of RAMP, says: "Never has a new lender had such a dramatic start with us. Advantage had a...

Offset growth accelerating.
July 2, 2007... Offset lending growth has doubled in the past year, according to the Council of Mortgage Lenders. The trade body reports that 170,000 offset mortgages were taken out in 2006 worth #29.3bn - equivalent to 7% of all new lending. It says...

Halifax unveils alternative GI commission plan.
July 2, 2007... Halifax general insurance has launched an alternative commission structure that offers brokers three years' commission upfront. The lender's standard commission structure pays brokers 25% commission in year one and then a trail commission...

LIBOR hits profits at Northern Rock.
July 2, 2007... Northern Rock has revealed lower than predicted profits for 2006 as a result of sky-high LIBOR rates. Last week, the lender released a statement admitting its full-year profit figures for 2006 will show a rise of just 15%, undershooting...

IN BRIEF: Commercial sales at auction drop.(Brief article)
July 2, 2007... The number of commercial properties sold at auction slowed at the beginning of this year, research by the Royal Institution of Chartered Surveyors reveals. RICS says this reflects a slowdown in investment across the broader commercial...

IN BRIEF: Connect joins TMW panel.(Brief article)
July 2, 2007... The Mortgage Works has added Connect Mortgage Group to its sub-prime distribution panel. The move follows changes made by TMW to its sub- prime range, including the addition of five-year fixed rate products across its buy-to-let offering and...

IN BRIEF: Money Partners appointment.(Brief article)
July 2, 2007... Money Partners has appointed Brian Ferguson as regional account manager for Scotland. He takes responsibility for developing broker relationships and for promoting products across the company's range. Copyright: Centaur Communications...

The Key to boost compliance.
July 2, 2007... The Key has launched a campaign to raise awareness about compliant practice in the broker community. The Mortgage Brain-owned software provider says that the campaign, called Get Ahead, will be used in advertising and workshops to inform...

Borrowers fear high income multiples.
July 2, 2007... Only one in 12 people who are planning to apply for a mortgage in the next three years would be happy to borrow 5 x income, according to mform.co.uk. Research by the price comparison website also shows that only one in 24 consumers would...

Rightmove offers house viewings via mobiles.
July 2, 2007... Rightmove has launched a service that enables house hunters to view over 695,000 properties for rent and sale on their mobile phones. The service allows mobile phone users full access to Rightmove's website. Users can also contact...

Hedge fund crisis renews sub-prime woes.
July 2, 2007... A few weeks ago, it seemed as though the US sub-prime crisis had eased - at least for a few hours. The 80 or so sub-prime shops closing since December meant surviving firms would benefit from less competition and improved pricing, and sub-...

IN BRIEF: Average rents are still rising.(Brief article)
July 2, 2007... Average rents are continuing to rise, according to Paragon Mortgages. The lender says average annual rents have risen every month since November 2006 to reach #10,702 this May. This is 1% higher than April's figure of #10,591 and up 9.7% on...

IN BRIEF: HML is rated above average.(Brief article)
July 2, 2007... Homeloan Management Limited has been awarded an above average rating by Standard & Poor's, with a positive outlook. S&P's report says HML has the resources in terms of people, systems and premises to achieve its growth targets without...

IN BRIEF: Mortgagematch exclusives.(Brief article)
July 2, 2007... Mortgagematch Home Loans has launched two exclusive near-prime products from Kensington Mortgages. The first of these is a two-year fixed rate at 6.39% available up to 90% LTV on self-cert and Right to Buy. The second is a self-cert two-year...

IN BRIEF: Mortgage lending up 8% in May.(Brief article)
July 2, 2007... Year-on-year gross mortgage lending rose 8% in May to #19.7bn, figures from the British Bankers' Association reveal. The BBA says this is the highest level of new business since November, reflecting strong remortgaging activity and in line...

IN BRIEF: Beacon appoints finance director.(Brief article)
July 2, 2007... Beacon Homeloans has appointed Steve Barry as finance and risk director. He was previously a partner with a private equity fund focussed on financial services. Copyright: Centaur Communications Ltd. and licensors

IN BRIEF: SPPL launches packaging guide.(Brief article)
July 2, 2007... Southern Pacific Personal Loans has launched a packaging guide. The guide takes packagers through each part of the process for applications, ensuring they are submitted ready to move to completion. Copyright: Centaur Communications Ltd. and...

Public unwilling to go green.
July 2, 2007... Consumers lack green mortgage knowledge and are unwilling to spend money to reduce their carbon footprint, Beacon Homeloans warns. A survey by Beacon found that 75% of people did not understand the meaning of the term carbon-neutral while...

Bridging and buy-to-let combination deal launched.
July 2, 2007... UX Mortgages and bridging loan provider Tiuta has launched a combined bridge and buy-to-let mortgage with a joint application and underwriting process. The providers say the product - Dual - is the first to combine the two elements and...

Edeus gets rid of charges for AVMs.
July 2, 2007... Edeus has dropped charges for automated valuation model decisions in line with its standard valuation costs. It was the second lender to launch point-of-sale offers using AVMs last September, a week after GMAC-RFC. However, its...

PM warned on buy-to-let tax.
July 2, 2007... Nationwide's chief economist has warned Gordon Brown that any changes to buy-to-let taxation could destabilise the housing market. The society's monthly house price index shows the bad weather in June had little effect on the market, with...

Gieve hints he will vote for rate rise this week.
July 2, 2007... Sir John Gieve, deputy governor of the Bank of England, has hinted that he will vote for a base rate rise next week to bring inflation back on course. In a speech to the University of Surrey, the Monetary Policy Committee member said...

Broker gets first NACFB Fellowship.
July 2, 2007... Mortgages for Business has become the first commercial finance broker to be awarded a Fellowship of the National Association of Commercial Finance Brokers. The NACFB considers this status a higher tier of membership and hopes the desire...

IN BRIEF: Leadbay keeps brokers busy.(Brief article)
July 2, 2007... Leadbay says it has generated #73.8bn worth of business for brokers in just over two years since its launch. It says half a million borrowers have used the site to seek mortgage advice since its 2003 launch and it passes almost #3.5bn of...

IN BRIEF: S&P appoints head of sales.(Brief article)
July 2, 2007... Select & Protect has appointed Paul Firkins as head of sales. Firkins was previously with Equity Insurance Group where he was responsible for developing and bringing to market general insurance platform first4cover. Copyright: Centaur...

IN BRIEF: Grainger adds to Newcastle team.(Brief article)
July 2, 2007... Property management firm Grainger has appointed Peter Welch as relationship manager for its Newcastle-based team. Welch joins Grainger from Prudential. Copyright: Centaur Communications Ltd. and licensors

Borrowers paying #78bn in mortgage interest.
July 2, 2007... Borrowers are collectively forking out #78bn a year in mortgage interest, research reveals. A study by accountant Grant Thornton found that if the national debt of #1.33trillion was shared equally among the UK's 25 million home owners,...

BDS invites brokers to Thorpe Park.
July 2, 2007... BDS Mortgage Group is holding an event for brokers called Roundtables and Rollercoaster in Thorpe Park. Delegates will have the opportunity to meet the event's nine lender sponsors, which include Amber Homeloans, DB Mortgages, edeus, GE...

IN BRIEF: RICS guide on sustainability.(Brief article)
July 2, 2007... The Royal Institution of Chartered Surveyors has unveiled a best practice guide for sustainability in the housing industry. It says that the social and environmental impact of sustainability should be considered in the five stages of the...

IN BRIEF: Newcastle targets specialist market.(Brief article)
July 2, 2007... Newcastle is looking to enter the light adverse and buy-to-let markets. This follows the appointment of Jon O'Brien as head of intermediary lending, who will be responsible for developing products for the broker market. Copyright:...

Do you think the government should tax landlords more heavily?
July 2, 2007... The Chartered Institute of Housing recently called on the government to remove tax relief for landlords, prompting a barrage of criticism in the consumer press with Patrick Collinson, editor of the Guardian's Money section, championing a...

MT expects #5.8bn in applications this year.
July 2, 2007... The Mortgage Times Group expects to receive 36,000 applications totalling #5.8bn by the end of this year. At the end of 2006, the group received 24,000 applications but this year it expects to exceed that and says it is on track to complete...

IN BRIEF: DB updates its website.(Brief article)
July 2, 2007... DB Mortgages has changed its website to allow brokers to access it directly through their preferred network or club. The changes allow instant online Key Facts Illustrations, decisions In principle, online applications and case tracking. ...

IN BRIEF: Three underwriters join Rooftop.(Brief article)
July 2, 2007... Rooftop Mortgages has appointed three roving underwriters to provide on- site coverage with members of its mortgage packager panel. Charlotte Riley joins from Freedom Lending, while Lynsey Allen and Nick Cannings join from Mortgages PLC. ...

IN BRIEF: Pink offers brokers more GI choice.(Brief article)
July 2, 2007... Pink Homes Loans has enhanced its general insurance proposition by offering members more choice. It says that 90% of its brokers wanted the option of using both its GI providers, first4cover and Paymentshield. Copyright: Centaur...

ANALYSIS: Market watch - 02.07.07.
July 2, 2007... After finally seeing some small falls in swaps last week, the minutes of the Monetary Policy Committee put paid to the drops and caused some of the biggest one day increases in swaps that I can remember. Although they fell slightly...

Should paying stamp duty be responsibility of home buyers or sellers?
July 2, 2007... Labour MP Peter Hain thinks sellers not buyers should pay Stamp Duty, but our experts think the problem is the tax itself Thomas Reeh is chief executive officer of blackandwhite.co.uk Let's talk about tax, or more specifically, stealth...

ANALYSIS: The eagle has landed among the PC pigeons.
July 2, 2007... A few months back, I was amazed to discover that Merchant Court, a redevelopment project in the centre of Bristol, had been forced to change its name. The reason? The name would be a blatant reminder of the slave trade that plied in and...

Dearth of supply is distorting the market.
July 2, 2007... One of Gordon Brown's first tasks in office should be to tackle housing supply. Demographic trends coupled with the stagnating number of new build properties are putting increasing pressure on the UK's housing stock. And what is...

ANALYSIS: The temptation of interest-only deals.
July 2, 2007... A timely email warning from My Mortgage Direct about interest-only remortgages arrived in my inbox last week. I'm in the process of trying to sort out my finances, including remortgaging my flat in London to free up some cash to buy in...

ANALYSIS: Dreams broken on the hamster wheel.
July 2, 2007... The age of seven seems young to learn the harsh lesson that London house prices are likely to shut you out of home ownership, but that's what my son learned last week. Of course, he's no mini-Donald Trump. The house he had his eye on was...

ANALYSIS: Clients on the verge of a payment breakdown.
July 2, 2007... Many borrowers will soon see big hikes in their monthly mortgage payments, which begs the question of whether the mortgage market should take some responsibility for the subsequent debt problems. Over the next 18 months, some two million UK...

ANALYSIS: Forgetting about HIPs would be the right move.
July 2, 2007... The Home Information Pack debacle has to rank in the top five blunders this government has made, and that's just the financial ones. There have been pension wind-ups, the state earnings related pension scheme, Equitable Life and...

ANALYSIS: Lenders' poor service costs brokers money.
July 2, 2007... Telephone charges are in the news again. Lenders have been hammered once more for publicising expensive 0870 numbers for clients to call when there are cheaper local area or even freephone numbers available. For brokers, the only thing...

ANALYSIS: Base rate rises hit B2L amateurs hard.
July 2, 2007... First, one of my Mortgage Strategy columns is referred to in a House of Commons debate. Second, our masters in Europe finally agree with me about the Equitable Life pensions fiasco and that the Financial Services Authority's role in it still...

ANALYSIS: Offset growth powered by broker distribution.
July 2, 2007... Offset mortgages hit the market about seven years ago and offered something new. Combining other banking products with mortgages had been done before with Virgin's all-in-one account, but offset offered a new structure when Woolwich and...

ANALYSIS: Brave MPLC leads the way on proc fees.
July 2, 2007... Mortgages PLC has had more column inches devoted to it in the past few weeks than at any time since the hugely enjoyable Peter Beaumont versus Michael Bolton showdown of 2004. For those of you who have been living on Mars for the past few...

ANALYSIS: Brown should not clamp down on loans.
July 2, 2007... During Gordon Brown's 11 years as chancellor, he has shown that he is not against taking out the odd loan on behalf of the Treasury. So does the start of his reign as Prime Minister bode well for the loans industry? Brown has repeatedly...

ANALYSIS: Help clients to hold on to their homes.
July 2, 2007... The growing number of companies that offer to buy peoples' homes while allowing them to continue living in them has turned the spotlight onto a twilight world often overlooked by mainstream commentators. A representative of one of these...

ANALYSIS: Time to turn your clients' fags to riches.
July 2, 2007... So England has finally joined the rest of the UK and gone smoke-free. And with the likes of EastEnders' Dot Cotton battling with the ciggies, it's sure to be a huge talking point in pubs and offices across the country for weeks to come. ...

ANALYSIS: Properties that don't cost the earth.
July 2, 2007... One of the things that causes brokers problems is when properties' methods of construction are non-standard. When it comes to green construction, methods are not only non-standard but could be deemed unusual and unacceptable to many lenders....

ANALYSIS: Packagers cash in on buy-to-let boom.
July 2, 2007... Over the past 12 months we have seen considerable growth in the buy-to- let sector. Products have become more competitive due to the pressure on rental yields, not just in terms of price but also criteria. During 2007 we have seen a surge...

ANALYSIS: Let me help you plan for the future.
July 2, 2007... I was a speaker at the recent Mortgage Strategy Invitationals, a series of regional events held across the country. A number of interesting themes emerged from the Invitationals, none more so than the way in which the industry is changing....

ANALYSIS: It's time to grasp lifetime opportunities.
July 2, 2007... If ever there was a time when clients should stop procrastinating about whether to take out lifetime mortgages, it's now. Longer term swap rates are climbing at a dramatic rate, with 10-year rates hovering just under 6%. No wonder then...

ANALYSIS: IP products need a dose of simplicity.
July 2, 2007... Figures for 2006 from Swiss Re show overall protection sales including life cover, critical illness and income protection business were up just 1.2% with about two million new individual protection policies taken out. Although 2006 may...

LETTER: We must make HIPs work for the benefit of consumers.(Letter to the editor)
July 2, 2007... From Derek Lithgow I am writing with regard to your recent article titled 'RICS warns of HIP loopholes' (Mortgage Strategy June 18). While I welcome the meeting between the government and the Royal Institution of Chartered Surveyors,...

A successful partnership must be a two-way street.
July 2, 2007... From Simon Burgess I have recently been looking into the opportunities that working with new business partners may bring and have found that entering into formal agreements is fraught with danger unless you are well advised and cautious....

LETTER: Arrangement fees winning idea for lenders and brokers.(Letter to the editor)
July 2, 2007... From Dave Rogers Stephanie Spicer's recent cover feature on arrangement fees (Mortgage Strategy June 11) presented a balanced debate on the subject. My only criticism is that it accepted lenders' explanations at face value. The fact is...

LETTER: It is in advisers' interests to do the best for their clients.(Letter to the editor)
July 2, 2007... From Alastair Clarke I read Paul Lewis's recent article with interest as well as irritation (Mortgage Strategy June 11). I have not been involved in the investment market since I specialised in mortgages and protection, and I would...

LETTER: The commercial market must have people with experience.(Letter to the editor)
July 2, 2007... From John Ford I read with interest the feedback and responses on the Packager Power page in the June 18 edition of Mortgage Strategy. I was particularly intrigued by the comments of Paul Rockett, managing director of The Business...

MPC: Shadow MPC.
July 2, 2007... The Mortgage Strategy GE Money Home Lending Shadow Monetary Policy Committee has voted to hold the base rate this month to give the recent rate hikes time to filter through. With the housing market softening, our experts have decided that a...