Moneyfacts’ Michelle Slade. “The same applies to the 100% LTV
deals, where all but one are from Northern Bank, which only lends in Northern Ireland – the other is from Tipton & Coseley and requires you to commit funds as security that isn’t accessible during the term of the deal.” Lipnicki thinks the government should
step in. “There are very few real solutions for
these borrowers on the market and the government should be doing much more to improve the situation,” he claims. “The Scottish National Party in Scotland
has announced a government Mortgage Indemnity Guarantee for first-time buyers which would be a good place to start for the coalition government in Westminster.” But Stockton says there are real options
available for first-time buyers. “90% LTV lending has returned, albeit
slowly,” he says. “We do need to shout about this. “Whilst unlikely to have a fundamental
impact upon first-time buyers or generate significant volumes, the lending policies that support shared equity and ownership in addition to guarantor products, multiple applicants, the new government FirstBuy initiative, the new build sector and right to buy, have all become areas of increasing importance.” Melanie Bien, director at broker Private
Finance, says first-time buyers may not realise that there are several options available to them. “Schemes such as Lloyds’ Lend a Hand
enable parents to help their child onto the housing ladder without actually handing over their savings, which may appeal to parents who are fairly hard-pressed themselves. “The Government’s FirstBuy scheme
may work for some, if they can get access to the rather limited funds available. “And those who are keen to buy a new
home may find a developer who has a scheme that can help, such as Bovis’ tie-up with Woolwich where it provides a mortgage indemnity guarantee or Barratt’s link with Hitachi Capital whereby the parents can borrow up to £50,000 to cover their child’s deposit,” she explains.
get in on the aCtion All very well, but how do you get consumers in through the door? The L&G research found 81% of respondents would prefer to make one attempt at securing a mortgage than trawl the high street but only 44% plan to visit a broker during their next attempt to obtain a mortgage. Lipnicki voices the concern many
smaller brokers come up against. “We spend around £50k on leads every
month and only 15% of those clients are seen by our advisers due to placeability,” he says. “You really do need to have substantial resources to get to the right clients.”
by Alan Cleary, managing director, Precise Mortgages
There is no doubt in my mind that many home owners believe that getting a mortgage has become as difficult as finding the proverbial needle in a haystack.
It is fully understandable given the massive amount of media coverage there has been over the last three years about the funding freeze, but I think now is the time to start to open customer’s eyes to the thawing that is taking place and how mortgage availability is actually improving. It is a well documented fact that
the credit crisis has forced mortgage lenders to tighten credit policy to an unprecedented level and it is true to say that the big six lenders have focused on borrowers who want less than 70% LTV and have a grade A credit profile. So it is no surprise that borrowers and brokers have come to the conclusion that anyone who hasn’t got a big deposit and a perfect credit score is doomed to failure when it comes to getting a mortgage.
But things are changing. Firstly the big six will increasingly find out that the borrower with 40% equity and grade A
But Laker says keeping in touch with
your existing client base will result in business. “Today’s broker needs to be in touch
with his client base regularly and keeping them informed of what is available and checking that they know to contact him if needed,” she says. “If they don’t someone else will.” The larger brokers have the resources
to blanket market to raise consumer awareness. “At Countrywide we are very pro-active
with our customer database and frequently contact them via SMS, e-mail, mail, etc to update them of new product developments and areas where we
credit will eventually run out and I believe we are reaching that point now hence the significant competition and price cutting. Secondly, funding conditions have improved markedly over the last 12 months; the securitisation market has started to show signs of life and the repayment of the Special Liquidity Scheme is ahead of target.
Both of these factors should see an increasing appetite from the big lenders and a move into higher LTV lending as well as other product areas such as buy- to -let. A third improvement is the increasing appetites of lenders such which are prepared to lend to customers who are in the near prime category. No longer are these borrowers assigned to the mortgage scrap heap and we have done extensive research to find out what the needs and wants of this type of borrower are and I am confident that our products and criteria fit the requirements perfectly. We are constantly looking at what changes need to be made to criteria in order to help near prime borrowers and this month you will see us add interest only, increase of our max loan size to help borrowers in the South, improvements to income verification for self-employed people as well as an imminent launch of our products into Scotland.
mortgage introducer AUGUST 2011 33
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