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nullo finullor not to finull nullenulle nullen asking tnull question nullr 21 years
With clients finding it Halifax helped to introduce ures, 68 % of new mortgage rate. in the late eighties, inter-
harder than ever to remort- a fixed rate culture when lending was on fixed rate est rates rose to 13 %, the in-
gage and rates at an all time it was a building society by products. troduction of a new product
low, Halifax took a look back launching its first product in Before the arrival of the revolutionised the market -
through the history books november 1988, with other fixed rate mortgage, irrespec- introducing a level of stability,
and worked out it’s been 21 products coming onto the tive of their individual circum- choice and competition that
years since the launch of the market throughout 1989. By stances, borrowers had little or has become customary for to-
fixed-rate mortgage. 2009, according to cmL fig- no choice in their mortgage day’s borrowers.
By February 1989, there
were 12 fixed rate products
from 12 lenders, compared to
over 1300 fixed rates from 69
nulle dawn onullreality
lenders today. over 1500 fixed liquidity and restrict risk its proposals for its fees for
rate products were available runs counter to expansive 2010/11. these include a
at the peak of the market in lending. the government significant increase in costs
2007. and treasury may now wake to cover Sale and rent Back,
the average fixed rate in
by
up to the risks of long term mmr and enhanced supervi-
Robert Sinclair
February 1989 stood at 12.55
director
tight money. People will not sion. ami will be challeng-
%. in 2007, when the avail-
AMI
be able to spend, borrow and ing these increases as the
ability of fixed products was spend. So demand will need cost of FSa mortgage regu-
at an all time high, this was at the Bank of england quar- to fuelled another way. lation now stands at £15.6
6.33 % - compared to 5.38 % terly inflation report showed the move in SVrs and million against a closing cost
in 2010. a slow road to recovery falling fixed rates is making in 2004 for the mccB of £4.4
the popularity of fixed rate without projecting the with- a remortgage more attrac- million. the 33 % increase
mortgages traditionally mir- drawal of the £200 billion tive. the risk to the purchase in mortgage regulation costs
rors the move in interest rates. pumped in through Quanti- market being starved of seems disproportionate as it
the percentage of fixed rate tative easing. inflation will funds is escalating, with both was not us who created the
mortgages typically increases spike somewhere sharply limited gross lending avail- banking crisis, but we appear
when the official Bank rate is over 3 % before falling back. able and the issue of how to be being left to carry the
rising. 2009 was an exception gdP will see much slower banks refinance their gov- can. Whilst smaller firms
when, despite falling interest growth than previous trea- ernment debt and maturing will see very small increases
rates, an increasing propor- sury estimates. the tax take corporate debt. our larger firms will see sig-
tion of new borrowers took a will stay constrained. the at this time of challenge nificant increases, with some
fixed rate product. this was door to more Qe remains and change the FSa, in los- close to having a doubling in
because many thought that firmly open, rather than the ing its leader, risks being left fees.
variables rates were as low as money being withdrawn without clear direction. it al-
they could go and so looked from the economy. all this ready appears to need work null a nullsitinull note
to protect themselves against means that our overlords are to tie the various strategy, all this says the road ahead is
future rate rises. nervous about the strength policy, supervision, enforce- rocky with the wagon wheels
of the economic recovery. We ment and delivery strands overdue a service. We will
How it looked in 1989 may have ended the reces- together. With a boss already come out of the mortgage
sion. But the official defini- in the north collonade’s re- market review a leaner, fitter
Halifax launched its first tion of recovery is two suc- volving door his teams will and more recognisable in-
fixed rate mortgage cessive quarters of growth be competing even more dustry. the consumer need
The official bank rate equivalent to 2 % per annum. ferociously to appear “top for advice is recognised and
averaged 13.67%, peaking there has been a grow- dogs” to whoever wins the we need to capitalise on this
at 1nullnull% in nulltober. ing acceptance amongst key election in may. the time for to prove that it is the inter-
nullnulltion, based on the nullnull commentators that there is the chairman, Board and the mediary sector that is seen as
nulls running at 7.null. insufficient bank funding Panels to exercise effective the natural home of good ad-
The average null house for small businesses and for control has never been more vice that customers can rely
price nulls nullnullnull3nullaverage mortgage lending. the pres- urgent. on and trust.
earnings nullre nullnull67null sure to re-capitalise, increase Finally, the FSa has set
mortgage introducer march 2010 null
MI p4-5_0310.indd 3 23/02/2010 10:55
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