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Leader: Time to reassess criteria

Last week, the Financial Ombudsman Service arrived at a landmark ruling when it found HSBC had unfairly rejected a mortgage application on the grounds of age.

A couple in their forties were turned down when they applied for a joint £250,000 interest-only loan over an 18-year term because Mr A, as he was referred to in the judgment, would have been over 65 when the loan had to be repaid.

While HSBC said it was entitled to have a maximum age policy, the FOS ruled that the couple’s joint income would have been sufficient to meet the monthly repayments.

This case is hugely significant and could well have set a precedent for similar cases in the future.

Some of the criteria around lending into retirement are ludicrous and, hopefully, this ruling will push lenders into reassessing how they treat borrowers who have loans that extend beyond state retirement age. 

And if it does not, then long may the FOS make such a public mockery of nonsensical lending policies.

As Patrick Bunton, director at London & Country and chairman of the Association of Mortgage Intermediaries, suggests in this week’s Mortgage Strategy, there may also be scope for borrowers to complain to the FOS should lenders refuse to implement the MMR’s transitional arrangements.

The MMR has rightly cleaned up lending but too often lenders hide behind the rules when they attempt to justify their often bizarre lending policies.

The broker community should continue to make its voice heard on this matter. Lenders listened when it came to proc fees and panel removals, so it is right to remain optimistic that they will listen on criteria too.



Rightmove: Asking prices up 4.7% year-on-year

The average UK asking price rose 4.7 per cent year-on-year to £286,133 in April, according to Rightmove. The annual rate of inflation fell from 5.4 per cent in March but April’s average asking price is the highest on record. On a monthly basis, asking prices were up 1.6 per cent, a rise of £4,381 in […]


Election 2015: What are the key manifesto pledges affecting financial services?

With the general election now only weeks away, Mark Sands, politics reporter for Mortgage Strategy’s sister title, Money Marketing, details the manifesto pledges affecting financial services. Housing The need for housing has driven all the major parties to pledge increases in construction. However, housing is a devolved area, meaning the Welsh Assembly and Scottish Parliament […]

Crystal Specialist Finance

Crystal Mortgages rebrands to become Crystal Specialist Finance

Packager Crystal Mortgages has rebranded as Crystal Specialist Finance. The Midlands-based firm has identified five areas it operates in – mortgages, bridging, commercial mortgages, development funding and second charges – and has created a specialist team for each. Managing director Joe Breeden says: “The name had become constrictive over the past decade as we moved […]

Cricket - thumbnail

England vs Australia: pensions

Well, the cricket season is here, and England and Australia are stepping up to the wicket. Although we compete with each other in the sporting world, when it comes to pensions, Australia’s pension programme is held up as a model for our auto-enrolment initiative. Auto-enrolment was introduced because people weren’t saving enough into their pensions, and it is still early days but signs are positive. However, in Australia, saving into a pension is compulsory, and in fact employers are the ones who have to pay in. Employees in Australia can make additional contributions into their pensions, but they don’t have to. Should the onus be on the employer or employee to save? Well in the UK we think it’s both, but to get ‘adequate’ savings for retirement it’s the employee who has to pay more in.


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