A headline in the April 30 issue of Mortgage Strategy - ’Return to recession is no surprise and is unlikely to unnerve lenders’ - was a timely reminder of how robust our lending environment is and that it will cope with adversity.
I believe this is a true reflection of the industry’s response to the recent hammer blow from Q1 data from the Office for National Statistics, which showed a 0.2% drop in gross domestic product.
Let me also echo the sentiments of Paul Hunt, managing director of Phoebus Software, who in the same article commented that “for an embattled government, the arrival of the double dip recession is brutal news, but the lending industry is unlikely to clamber into its shell as a result of the news”.
But the word recession remains a powerful one for consumers, especially home owners who are already feeling the financial squeeze in various guises.
At a time where consumers will face an extra £300m in repayments over the next year due to lenders increasing SVRs, surely the combination of recessionary fears and SVR uncertainty provide the perfect platform to boost brokers’ remortgage offerings.
There are still hundreds of thousands of households that could be financially better off by remortgaging today.
This is a powerful message for when household budgets are tight and is one that needs communicating to clients sooner rather than later before the recessionary bite goes even deeper.