ANALYSIS marketwatch
I haven’t seen any convincing arguments made by lenders against compulsory advice as proposed in the MMR, just scaremongering. The good news is that fears of a double-dip recession look unfounded
ANDREW MONTLAKE DIRECTOR CORECO GROUP
Q
1 2012 is over and done with in a maelstrom of rate rises, last-minute changes, criteria
tightening and general broker bashing.
But things are looking up.
According to the British Chambers of Commerce, businesses are more upbeat about economic prospects than they were at the end of last year, with some activity measures at their best levels in nearly a year. Meanwhile, the latest
Markit/CIPS survey of service providers indicated stronger growth of both activity and new business in March amid reports of an improved economic climate. Fears of a double dip look increasingly unfounded. Against this backdrop, swaps
have not done much at all and LIBOR is equally unexciting. Three-month LIBOR is
unchanged at 1.03%. 1-year money is up 0.01% at 0.95% 2-year money is down 0.01 at 1.23% 3-year money is down 0.02% at 1.30% 5-year money is down 0.02% at 1.58% As expected, lenders have been
rallying round to plead on bended knee to the Financial Services Authority about its plan to insist on advice being given in all cases where actual contact with a consumer is made. I have not heard a decent argument against this yet. The Council of Mortgage Lenders has gone down the scaremongering line with regard to increased costs, reduction in lending and so forth, while the Building Societies Association says forcing advice on clients will make
INTEREST RATE SWAPS
0.75 1.00 1.25 1.50 1.75 2.00 2.25 2.50 2.75 3.00 3.25
them less engaged. I do not buy that for a moment. Many clients who approach
brokers think they know what they want and do not get less engaged as we go through our process. In fact, it’s the opposite.
It is not insulting to customers to insist on advice. Some people take more advice over their choice of car or television than they do on getting a mortgage. That’s crazy. On the subject of crazy, it was a shame to see proc fees reduced for directly authorised brokers by Nationwide and Lloyds Banking Group. I understand lenders need to rationalise their distribution but this will be a kick in the teeth to many brokers. Meanwhile, Co-operative Bank
●1 YEAR ●2 YEAR ●3 YEAR ●5 YEAR
HERO OF THE WEEK Aldermore Residential Mortgages – it’s the personification of taking a fresh approach. Along with some regional building societies, it is doing sensible underwriting and supporting brokers.
is the latest lender to increase its SVR – from 4.24% to 4.74%. Skipton Building Society has
introduced buy-to-let rates up to 75% LTV with good flat fees, and a 3.99% two-year fix up to 80% LTV on residential loans. Accord Mortgages has launched
another product range while Woolwich has tweaked its rates. Platform has reduced its
two-year fixed rate buy-to-let products and Coventry Building Society has refreshed its range, offering a five-year fix at 3.99%. Finally, last week saw the latest house price figures published which, depending on which index you follow, basically say that values have either gone up or down, or possibly stayed the same.
www.mortgagestrategy.co.uk
VILLAIN OF THE WEEK The Financial Services Consumer Panel, whatever that is, for saying last week that mandatory advice would be unnecessary for the majority of mortgage customers. What a load of tosh and poppycock it speaks.
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MORTGAGE STRATEGY April 9, 2012
Jan 12 Dec 11 Nov 11 Oct 11 Sep 11 Aug 11 Jul 11 Jun 11 May 11
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Apr 12 heroes&villains
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