Historically the government has been known for being ‘in touch’, making reasoned decisions and providing tangible help.
The Labour term has brought in some good reforms, initiatives and general economic stability – but most of these have not been in successfully implemented our sector, which just seems to be detached from reality.
The key change was the introduction of the Financial Services Authority – a massive overhaul which, according to the Conservatives this week, could be removed without too many problems, saving the industry a staggering £14 billion a year. Surely this slush fund could provide for the few complainants and then some?
Labour has also continually spouted on about the virtues of long-term fixes, albeit not compatible with the lifestyles of the modern family values. I have yet to find one adviser that agrees with the sentiment.
Recently, I was genuinely shocked to learn the introduction of Home Information Packs (HIP) for three-bedroom properties is planned for September. Most of the more well informed in our industry appeared to suggest this would happen later in the year. In a BBC interview, a HIP inspector pointedly said he has only had one job so far – the cynic in me therefore believes the government is racing on with the project that took it 10 years to make – or break – so that those who have spent on training don’t revolt further. Who wants HIPs again? I’ve forgotten. Certainly not the estate agencies I have spoken to, who have been very quiet – even allowing for the holiday makers.
Affordable housing has been a regular promise – seemingly entrenched in the government’s manifesto. To be fair many sites that were sitting dormant around London for years – presumably because of red-tape – appear to have been waved through the elongated planning permission bureaucracy. However, not content with the way this was going, the government has decided to juggle the balls again, sending out a ripple last week when it mooted a change to shared ownership. Meddling again, it said it would look closely at preventing staircasing to keep the affordable stock available for the most in need. Perhaps a commendable sentiment, but surely applicants enter into a transaction and lovingly look after their housing association property on the basis that they can buy increased segments in an affordable way and then one day realise full ownership. Take away the love and the standard of the properties will probably deteriorate faster, be less desirable and nurture extra social problems – take away the dream and the purchasers might not be interested in the first place. From a lending perspective, remortgages of shared ownership may become a thing of the past.
Conversely, when everyone in the non-conforming arena is sitting there waiting for a government injection to prop up the market in the wake of the well documented non-conforming demise just like the Federal Reserve – their state fire engine has stayed firmly in the station.
Mainstream
Northern Rock is offering free valuation on remortgages for the first time.
Leeds Building Society has reduced its income multiples.
Buy-to-let
Northern Rock now offers a ‘Fast Track Guarantee’ which placates the need for a surveyor to prove rental under 80 per cent loan-to-value (LTV).
Advantage is back in the buy-to-let market. It now allows remortgages one day after purchase. This will please the big developers and property clubs that use this method to shift new build property. Advantage also offers 100 per cent rental cover at 90 per cent LTV with portfolios to a maximum of £5 million.
Bank of Ireland has dropped the rental coverage on its three-year fixes to 125 per cent on its holiday let criteria.
CHL Mortgages online system removes the need for mortgage history questions on other properties within the portfolio – this should make it a much more favourable solution.
Investec has pulled out of the buy-to-let market, which has had a direct impact on Infinity Mortgages, UX Mortgages, Unity Home Loans and Freehold Mortgages.
Self-cert
db mortgages no longer offers self-cert on super light downwards.
London Mortgage Company, Preferred and GMAC-RFC have included the option to make phone checks within their lending policy.
Adverse
Amber is the braviest non-conforming lender around, entering into the unlimited adverse remortgages on a self-cert basis up to 85 per cent LTV. Maybe it is in a position to make a name for itself knowing Skipton could write to balance sheet if needs be? In the media it has been reported Halifax might be tempted to adopt a similar balance sheet approach in the lighter end of the market – but it is currently denying this.
db has removed first-time buyers from super light downwards and reserves the right to call the applicant to discuss their financial difficulties – brokers will not like this at all. Its heaviest plan has been reined back to five arrears, none in last three months, or £20,000 CCJs.
First National has moved away from 100 per cent lending. Fearing it will be left alone in the sector Future Mortgages has subtly tightened its credit score.
Automated valuation model offerings are also under increased scrutiny with Lehmans and edeus appearing to be trying to slow this business down.
Mortgages plc has removed the ‘or’ category from either CCJs or arrears.
Victoria is stating its reprice could be as much as 2.5 per cent higher.
Rooftop Mortgages and London Mortgage Company are capping the addition of fees to within the LTV maximum.
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Views from the industry
