I have just spent this morning looking at the much anticipated new FSA proposals for the mortgage industry, which weighing in at 118 pages is a healthy size, (actually my scan reading powers were put to the test to be honest!)
Whilst the majority of the proposals in themselves are not unexpected, the key will be in their implementation to ensure they benefit not only the industry, but ultimately the consumer.
We all know that there has been a need for a while now to drive out the darker elements and re-professionalise the mortgage industry, especially at a time when more and more people need advice.
I was up at the crack of dawn today for a quick comment on Wake Up To Money on BBC 5 Live, where the topic was the fact that LIBOR rates have now fallen substantially. 3 month LIBOR, which was so far out of kilter a few months ago and used as the main excuse behind lack of funds is now down at 0.75%, basically back to a “normal” level.
If this is the case, then why have rates not decreased?
For me Lenders at the moment are pricing based on three areas; cost, profit and fear.
It seems to me that we are entering a crucial phase in our personal and economical development after the seemingly cataclysmic events of the past couple of years. It is time for us all to mature and move on, to accept the harsh lessons learnt, to let bygones be bygones if you like.
The blame game that has been going on for a while has now seen everyone from the government, the bankers, credit agencies, regulators, mortgage brokers, estate agents, the press, the general public, the Americans, the French!, or just men in general bearing the brunt for the credit crunch and ensuing recession.
Figures from the Council of Mortgage Lenders, (CML) today show that gross mortgage lending in June was an estimated £12.3 billion, a 17% increase from £10.5 billion in April and a 48% decline from £24.8 billion in June 2008. The last two quarters have held steady, albeit at low levels.
Whilst there has been some tentative positive news emerging from the housing market in recent days, these latest figures reflect more of a seasonal jump than a long-term improvement. There is still no doubt that lenders are not lending enough to meet consumer demand and where lending is taking place, this is often at seemingly expensive levels. A sustained increase in lenders willingness to lend is vital to help provide the boost to the economy that is sorely needed.
Our very own MD Matt Lowndes emailed me an idea for my blog today which was so nicely written I thought I would just make him my guest writer for today. As my ears are still ringing from seeing the brilliant AC/DC last week, it gives me more recovery time, and keeps with the musical theme. Over to you Matt…
So I spent most of the past weekend wishing I was up to my knees in a field of mud in Somerset, yes Glastonbury was on and as ever I regretted not actually buying a ticket and making the trip. As they say you have to be in it to win it. But I did metaphorically pitch up a tent in my living room and kick back and relax.
Andrew Montlake, Communications Director at Coreco and ‘Mortgage Personality of the Year 2008’, gives his views — honest and no holds barred — on the latest developments within the mortgage and property markets.
