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Brokers lose out as Nationwide and Lloyds group decide to cut proc fees


Nationwide and Lloyds Banking Group dealt a blow to the broker market last week by making cuts to a number of their proc fees. Mortgage Strategy understands

Nationwide has cut its proc fees for directly authorised brokers by 0.02% from 0.35% to 0.33%, but appointed representatives are not affected. Nationwide would not confirm the extent of the cut as it considers the information commercially sen - sitive but says the fees it pays inter - mediaries are still competitive. A Nationwide spokeswoman

says: “We are confident our proc fees are competitive. We still pay more than some other major lenders.” Lloyds group has also made chan -

ges to proc fees through cer - tain brands.

It is understood that BM Solutions will now pay all brokers around 0.02% less although this will vary bet - ween distributors.

Commission has also been

cated some changes across our brands, effective from April 1, and as a result some fees have reduced but others have increased.” Ben Thompson, managing

changed on the Lloyds TSB Scotland and Scottish Wid - ows brands. Lloyds group would not confirm det ails, except to say that some distributors have experienced in creases and some decreases. Halifax is understood to be largely unaffected. A Lloyds group spokeswoman


direc tor of Legal & General Mortgage Club, says that while on one hand the cuts are a logical tidying up exer -

cise that bring the brands into line with rival firms, it still repre sents a loss for brokers. He says: “We’ve always said that

says: “We regularly review proc fees to ensure they remain aligned with our business strategy and the mar - ket. We have recently communi -

when the recovery comes round the most growth is going to come from the interme diary chan nel, so it’s important lenders keep them finan - cially healthy and moti vated in the quiet periods so they can take ad - vantage when the market returns.”

REGULATION Bank says government should control LTV ratios


The Bank of England has defended its decision not to ask for control of LTV ratios for the Financial Policy Committee, arguing that the power to limit mortgage borrowing should rest with the government, not un - elected regulators.

Last month the interim FPC pub - lished a wish list of macro-econo - mic tools it wants the committee to have at its disposal when it gets up and running next year. The Bank asked the government

for a sectoral capital buffer tool which would see it able to require higher capital to be held against

exposure to certain sectors. But it drew criticism for not asking for a lever to control LTV ratios. Peter Sands, chief executive of Standard Chartered, accused the committee of asking for tools which also stop people borrowing too much. Writing in the Financial Times

last week, Paul Tucker, deputy governor for financial stability at the Bank, says: “Outright bans on households taking out loans with high LTVs – including banning families borrowing from outside the UK financial system – would in the

view of many of us be a matter not for the FPC but for the government to pursue directly. “The higher the requirement [of the sectoral capital tool], the closer it approximates to constraining portfolios of high LTV loans. But it would not cut across lenders’ judge - ments on the creditworthiness of individual borrowers.” Tucker adds that it will be parti -

cularly important to justify any sectoral intervention by the Bank. The Treasury has yet to say

whether it will give the FPC the tools it has asked for.

SCOTLAND Green light for first tenancy deposit scheme in Scotland

The Scottish government has app - roved its first tenancy deposit protection scheme, The Letting Protection Service Scotland, which will launch on July 2. The Tenancy Deposit Schemes (Scotland) Regulations 2011 came into force on March 7 2011 following approval from Parliament. It then entered into a consulta -


tion process between December 2011 and January 2012, with the aim of approving at least one scheme by the end of March 2012. The scheme has been intro duced

to tackle problems faced by tenants, including unfairly held deposits and delays in the return of deposits. Under the regulations, landlords and letting agents are required to

sign up to and protect deposits with an approved Scottish govern ment deposit protection service, such as TLPS Scotland. The regulations allow Scottish ministers to approve more than one scheme and in addition to TLPS Scotland, proposals have been received from SafeDeposits Scot - land and My Deposits Scotland. IN BRIEF

Coventry unveils a range of deals with fee options Coventry Building Society has launched a range of offset, fixed, base rate tracker and buy-to-let products with various fee options. The deals include a five-year fixed rate at 3.99% up to 65% LTV with a £199 booking fee and £800 arrangement fee.

Enness Private Clients names commercial head Enness Private Clients has appointed Chris Whitney to head its commercial arm. He joins from property investment company St Vincents.

Manchester is 49th member of PMS panel PMS has added Manchester Building Society to its lender panel. This boosts PMS’ panel to 49 lenders.

Coreco in referral deal with Stirling Ackroyd Coreco Group has signed a referral agreement with London estate agent Stirling Ackroyd.

Advert banned for fake testimonial on website An advertisement from short-term loan firm has been banned by the Advertising Standards Authority for being misleading. The ASA was unable to find any documentary evidence that a testimonial on its website was genuine.


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