Apart from the normal world woes, the financial pages once again gave the industry a good beating. Cynics would say no surprise there, our industry is usually in the firing line.The lead story was not related to mortgages but was pertinent none the less. What is getting everyone so vexed is the charging of fees (some say excessive) on current accounts. This has been added to a growing list of consumer issues ranging from endowment mis-selling to payment protection on credit cards to exit fees on mortgages. The problem for the financial services industry will always be one of justification. Spokespeople can state the reasons why the afore- mentioned concerns are not problems. This is the way the industry works, and many of the alternative views are persuasive to an extent. Consumer cynicism is growing as was clear to see in Mortgage Strategy’s Word on the Street on early repayment charges last week. There is clearly a lack of understanding and realism on the part of mortgage consumers. According to the consumer feedback it seems it’s all right to take a two-year fixed rate at 1.99% and not have to pay an ERC for up to five years. By the same token it’s also not a problem that a 4.99% fixed rate is taken for two years without an ERC applying. I guess most product managers would be happy to run through the financial models but a fixed rate with no early redemption char-ges would be a step too far. But this ingrained something-for-nothing consumer attitude forms part of the steep hill advisers now have to climb. It’s about education – basic understanding of what is on offer. Education of this type is a long-term thing and needs a concerted app-roach from the education system, the regulator and the financial services industry. The journey looks like being a long one. A good place to start would be to get people to understand that if a lending insitution offers you credit, you don’t have to take it. I guess it proves two of the oldest clich豠to be true – it takes two to tango and there’s no such thing as a free lunch. I won’t be buying a Sunday paper again for quite some time – perhaps until the 2010 World Cup. Simon Biddle is head of communications at Infinity mortgages
The Financial Services Authority has confirmed it will continue to judge firms’ standards of product sales and financial advice by the standards and rules at the time of sale and not retrospectively. This policy will not be changed by the regulator’s move towards more principles-based regulation.The framework the FSA operates under dictates that it will […]
The World Cup is in full swing in Germany but closer to home, as Arsenal sets the pace in the redevelopment league, buyers should ponder the benefits of living near football stadia, says Barney McCarthy
Gordon Brown has celebrated the invaluable contribution of the Muslim community and put forward an ambition to make Britain the global gateway to Islamic finance and trade. Speaking at the Islamic Finance and Track Conference in London, the chancellor of the exchequer thanked the Muslim community for their enormous contribution to the British economy. He […]
Alliance & Leicester will shortly start to distribute buy-to-let, self-cert, near-prime and sub-prime specialist mortgage products through a number of mortgage intermediaries. The assets originated will be sold to Lehman Brothers under an agreement. The bank confirmed this in its 2006 pre-close announcement to the City today.Mehrdad Yousefi, head of intermediary mortgages, says: “We are […]
In this guide, Johnson Fleming reveals what items you need to understand to gauge the impact of auto-enrolment on your business. The guide focuses on: the impact that your auto-enrolment scheme will have on you; assessing your workforce; understanding your staging date; reviewing your current provision; and modelling contribution levels and costs.
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