MI_22-23_mortgages.qxd 27/2/09 11:13 Page 3
Mortgages | 23
underlying picture for consumer spending
appears weak; businesses have responded to the
worsening outlook by running down invento-
ries, cutting production, scaling back invest-
ment plans and shedding labour.
Stability
Against such an economic backdrop it is no
surprise that some form of stability is fast
becoming a prerequisite for most people.
Accordingly, fixed rate mortgages now account
for around 75 per cent of the market compared
to nearer 50 per cent a year ago. Clearly the his-
toric cuts in interest rates to the present level
has created an exceptional opportunity for
thousands of would-be house buyers and
homeowners; we are quite simply seeing some
of the best mortgage rates, particularly fixed
rates for three, five or indeed 10 years, in living
memory and the chance to take advantage is
very compelling for those in a position to do
so.
A further alternative in terms of best advice,
which we are encountering daily, is to recom-
mend remaining on an existing lender's SVR.
Again, something which the average borrower
might find bizarre, but nonetheless represents
appropriate advice in many circumstances, par-
ticularly for those people with existing buy-to-
let mortgages where lenders have tightened
criteria to a quite devastating effect.
Peace of mind
Given the above, ensuring that the client gets
the best deal in the current market is to ensure
peace of mind in the face of contradicting
complexity. Never has it been more necessary
for consumers to obtain real independent
mortgage advice. Although some recent minor
relaxation of lender margins is becoming
apparent, I believe there remains a shortage of
financial liquidity which when linked to con-
servative lending risk policy will not result in
too much change in the present mortgage mar-
ket lending conditions for some considerable
period, certainly not in 2009.
In summary, advisers face a continuing
tough market to source the best deal for their
clients. The good news is we are quite simply
seeing some of the best mortgage rates ever but
only for those who can fully satisfy more
guarded lending criteria.
Those clients for whom you are able to pro-
vide advice will require an exceptional service
which begins with a comprehensive investiga-
tion into the client's circumstances, and could
well be allied to a tactful explanation of why
initial expectations may or may not be achiev-
able. This will result in the provision of tai-
lored advice to source the most suitable
product available and crucially the clients' eligi-
aking
bility for it. The opportunity now is to take full
advantage of low fixed rates while the opening
eatht
Br
remains, based as always, on individual needs
©
and circumstances.
www.mortgageintroducer.com March 2009 Mortgage Introducer
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