For sub-prime especially, the days are long gone when it was frowned upon as the domain of the back street broker – a place where override payments thrived and clients were hit with dual interest rate pricing under the notorious Rule of 78. Now the sector oozes credibility with corporate big hitters relaxing underwriting criteria to grab a slice of the action.As we explore in our supplement on specialist lending with this issue of Mortgage Strategy, there may be just few more than a handful of lenders in the sub-prime market but between them they offer several hundred products. Then there’s self-cert, once catered for by a few specialist lenders but now boasting over 30 providers including household names such as BM Solutions, Bristol & West and Standard Life Bank. Whether the buy-to-let market should be fully regulated will continue to be argued about for some time yet, but for now we can see it has grown from a fledgling to a sector served by over 80 lenders. The steady gain in respectability across the specialist lending spectrum has been brought about by cheaper pricing, ultimately as a result of increased competition and a growing awareness of the benefits it can offer. The key to specialist lending in the sub-prime and self-cert markets – what makes these two dynamic markets so successful – is the empowerment of home ownership. Or, as in the case of lifetime mortgages, being able to utilise your greatest asset when you need to most. Home ownership is the bedrock of our industry. Allowing these clients access to the best available finance with the best available advice keeps the housing market buoyant, helps keep society stable and drives the intermediary market forward. Long may it continue.
- Top trends
There is substantial demand in the equity release market but distribution is becoming a problem as advisers shy away from what they see as a high risk sale, says Harvey Jones.
From Wesley Davidson Why has almost every buy-to-let lender decided to charge fixed rate 1% and 1.5% fees? It seems there is a ‘low rate, high fee’ bandwagon on the move. The Mortgage Works started the wagon rolling and since then lenders have jumped on it in droves. In most cases I have brokered I […]
The government last week opened new premises for National Debtline and revealed plans for a 45m free debt advice service. National Debtline helps 60,000 people a year find a way out of debt. It’s now moving to bigger premises after taking on 19 new staff, bringing the total number of full-time telephone debt advisers to […]
The default retirement age (DRA) was abolished more than three years ago, yet new research from Jelf Employee Benefits suggests that the vast majority of employers still have some way to go to fully understand, comply and communicate the landmark legislation change that prevents older employees being forcibly retired on the grounds of age alone.
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