News Review: Lending
March lending boost sets optimistic Spring tone
by David Finlay, intermediary business director, Barclays
gross mortgage lending in- creased by a relatively healthy 21% in march following a somewhat lacklustre Janu- ary and February, according to data from the council of mortgage Lenders. Figures released report
that gross mortgage lending was an estimated £11.3bn in march compared to £9.3bn in February. However gross lending still registered a 2% decline compared to the £11.5bn in march 2010. gross lending for Q1 2011
was therefore an estimated £30.1bn, an 11% decline from Q4 2010 - £33.9bn - and a 1% increase from £29.7bn in the first three months of 2010. With march historically
being the advent of increas- ing activity in the housing market these figures mirror the cautious optimism be- ing reflected throughout the industry. Let’s hope that they can continue to gather some more momentum in the coming months.
Remortgage market the latest figures from the council of mortgage Lenders show that remort- gage lending increased in February, from 23,200 to 24,300 worth £2.9 billion. the figures showed a 5% increase in the volume of remortgage lending (no change in value) from Janu- ary and a rise of 3% by vol- ume but fall of 3% by value
from the same month last year. the trade body adds that the Bank of england’s large increase in remort- gage approvals in early 2011 has not yet fed through to completions but is ex- pected during the next few months. approvals for remortgag-
ing increased in February to 35,725 which is 5.2% higher than the previous six-month average of 31,674, show the latest figures from the Bank of england. the number of loan ap-
provals for house purchase (46,967) increased in Febru- ary and was higher than the previous six-month average of 46,413. remortgaging has increased by a total of 39% since June 2010. in terms of value remortgaging was up by 8.9% month-on-month to £4.7bn in February. the remortgage market
continues to be the backbone of the intermediary market and with interest rates still at historic lows and a good range of competitive deals available there is no sign this steady momentum will slow anytime soon.
Regulation the Financial Services au- thority is said to have trebled the value of fines it has col- lected from financial ser- vices businesses in just one year from £33.1m to £96.7m. according to city law firm reynolds Porter chamber- lain LLP there were fifteen £1m+ fines last year worth £86.9m, up 216% from £27.5m the year before when there were eight £1m+ fines said to be recorded. it also
8 mortgage introducer MAY 2011
adds that the average fine handed down by the FSa last year was up 49% on the year before, from £739,284 to £1,099,159. the cmL has claimed
intermediaries are not en- gaging in the regulatory de- bate, following research that shows 92% of brokers had not responded to the FSa or other trade body on its distribution and disclosure proposals. analysis carried out
by tcfinfo just before the closing date for responses to the distribution and dis- closure papers shows 60% of intermediaries had no plans to respond to the FSa. the survey also suggests that just 11% of intermediaries feel “very confident” in their knowledge of the mortgage market review. these are interesting fig-
ures but the most concern- ing is the lack of overall confidence in regards to the mortgage market review. there are many forms of resources available through distribution partners, out- sourced compliance experts, the FSa and trade bodies and as such i urge interme- diaries to ensure they are as well informed as possible in regards the mmr as its im- pact on the market is poten- tially huge.
Acquisitions and consolidations countrywide has announced it has bought Bournemouth- based network mortgage in- telligence. in may 2009 mort- gage next’s parent european Financial Solutions bought mi to form mortgage intel- ligence Holdings.
in other acquisition news
the management at mort- gageforce has completed the purchase of the broker- age from West Brom Build- ing Society. the buyout was first revealed in may last year but in a statement released recently the brokerage con- firmed that the management team, headed by managing director Kevin duffy, has completed the purchase deal. it has also been reported
that BdS and Pink will be consolidated into one net- work under the Pink Home Loans brand and all former BdS advisers will now be- come part of Pink.
Offset research suggests that up to 10 million homeowners may be missing out on making the most of their savings with an offset mortgage. the re- search revealed a lack of un- derstanding about this type of mortgage, with a third of respondents unaware offset exists, a third having no idea how it works and a further third having an incorrect un- derstanding. the figure of 10 million
is a huge one and helps il- lustrate the potential of this market. But keeping this in perspective offset is still a product that won’t suit every- one but is certainly one that can help borrowers be as tax- efficient as possible and help maximise their savings. un- fortunately a lack of under- standing does still exist and as such we have to continue working hard to educate con- sumers and intermediaries in regards to the potential ben- efits attached to offset.
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