Summer has just passed us by, and already people are discussing the C word. Christmas. With the industry gearing itself up after a Summer slowdown, people have moved on to the next time of relief they get.
However, between now and Christmas many changes are predicted, be it more lenders adopting automated valuation models (AVMS), new lenders entering the fray, a Bank of England Base Rate rise or greater FSA control over certain market sectors.
A number of market sectors have come under review within the last few weeks, and although the equity release market remains a relatively small sector, the news that brokers think that organisations are down-valuing properties associated with this product area is an issue that needs to be addressed.
Indeed this week, the Financial Services Authority (FSA) confirmed its intentions to begin the second stage of its regulatory visits, looking into lifetime mortgages and the larger non-conforming sector. In its initial report the FSA found evidence of failings, and it will be looking for major improvements in both of these sectors. The FSA has stated its attention will revolve around the treatment of customers – specifically if they are being offered suitable mortgages related to their financial position, and what advice they are given over the life of the mortgage if their lifestyle or financial situation changes. The non-conforming and lifetime markets were identified by the FSA in its preliminary review as areas where there was the possibility of consumer detriment, and remain areas where intermediaries need to ensure they are following correct procedures. While much of the regualtory advice issued by trade bodies and the regulator has been taken in, work still needs to be done in these areas to ensure that best practices are being carried out throughout. Only this way can the industry truly rid itself of the tag of ‘unfair’ that sometimes dogs it.
One lender that has this week undergone such change is Portman Building Society which has dropped its arrangement fees on a number of its product ranges. With lenders adopting strategies to be more transparent the industry can only improve.
While much focus has been placed on market areas, a continued concern for the mortgage market and general financial services sector has been the lack of new blood into the financial arena. As stated by Emma Lunn on page 49, while many graduates do not view the financial services sector as a good place to work, schemes are in place to change this attitude, and the sector provides rich opportunities for ‘new blood.’ It is also the case that people interested in the market can choose several options. While some will complete examinations prior to joining a firm, others will seek training on the job. As Rob Griffiths, associate director at the Association of Mortgage Intermediaries (AMI), states: “A number of intermediary firms, for example, run academy-style operations taking new employees through their exams while also offering them on-the-job training.”
Schemes like this should be applauded and only with trade body, regulatory and general market help will the problem of recruiting new, eager people into the market be eased.
