This will be my final letter to Mortgage Strategy as I will retire at the end of December after nearly nine mainly happy years as an independent adviser following 24 years with NatWest.
The events of the last few weeks have made me so glad to be going as the last three cases of my life have all gone to appeal and complaint by me against the lender.
The three lenders have demonstrated the almost complete lack of corporate intelligence and integrity in the industry.
I admit to having been somewhat smug at the lack of declines in my career even though I have done plenty of 90 per cent LTV deals.
This is a result of 30 years of lending experience, good research and the fact that I decline the poor ones myself.
I don’t mind a decline at all in the early stages of research but when lenders have said yes at every stage and then say no without any new information at the end, it is frankly sickening.
I had a case dropped by Halifax over problems with a split title.
My clients ran an extremely successful farm but their business bank RBS would not lend for residential purposes on the farm building. It fitted Halifax’s criteria for agricultural ties and was 40 per cent LTV at most.
The titles had to be split so that RBS kept the farmland. I had discussed this including the split title aspect with Colleys, my BDM and the help desk.
Two months later, someone in Halifax’s business prevention unit came up with a stroke of genius which even I with my ability to second guess silly obstacles from tick box robots, could not have got.
They said that if the house got the new title number, the clients would not have lived in the title before despite the fact that they had lived in the house since it was built 20 years ago.
Now after, several weeks of the solicitor banging his head against a wall, Halifax says it is not lending at all with no reason given.
The bank ultimately agreed that it was a total shambles have provided compensation and are paying the solicitor’s bill, but nothing for the broker of course. We are just voluntary workers.
My former employer NatWest showed why I had to leave them nine years ago to keep my sanity after it refused to proceed with a mortgage for a 28 year old client earning £40,000 because of a small default the client had with BT when the communications firm admitted it had no record of an account in his name.
My BDM told me there was no point in appealing a credit score fail despite me bringing the value of the clients connections to her attention – but I have made a complaint which has not gone down well with my BDM that I refuse to cravenly accept her assurance that it isn’t worth appealing.
But the most disappointing of the three lenders has been a small building society as I expect better from mutuals.
My clients have a converted barn close to their farm shop. Only three lenders said this was not out of policy, and two of them had extremely low income multipliers so this left the mutual.
The decision in principle was approved with the mutual after 10 days and despite the underwriter giving a negative answer about the property based on the photos provided, it gave the go ahead for a full paper application.
But I was told much would hinge on the valuers report and true enough I phoned up to be told that they would not be proceeding because of the valuation.No one had the courage to ring me. The valuation came back at the £300,000 at 60 per LTV and the property fitted the lender’s criteria. Yet the letter to the client said it does not fit its lending criteria.
Some 10 days after hearing nothing from my appeal , a letter to the chief executive produced the correct decision and I was assured that the head underwriter had made the decision over the weekend before the letter arrived. Seven days later it has finally at least gone to approval.
After the war, the aim was to make a country fit for heroes. We now have a country fit for and run by imbeciles and crooks. I pity the poor wretches remaining in this industry.
I read with interest the 5 November article about Hodge Lifetime’s mortgage which allows £1k-a-time drawdown.
Simon Chalk at Bower Retirement Services asserted in the article that the product was the best drawdown plan on the market allowing customers to draw down as little as £1,000 at a time and calls for the wider industry to play catch up.
Many providers have long been innovating across their product range to better service the needs of those in later life.
In fact the Age UK Equity Release Advice Service has a plan which offers drawdown from as little as £500, an offer which has been available to the market since November 2010.
Flexibility and simplicity are absolutely key to making these products more accessible to a growing older demographic and can go a long way to helping people understand how equity release could play a valuable role in later life financial planning.
We support the article’s objective and a greater debate on the benefits of equity release but believe that a whole of market appreciation is in order to highlight the depth and breadth of products available on the market.
Age UK Enterprises
In the last couple of months it has been revealed that claims management companies are turning their sights on interest-only mortgages in what is being called the next misselling scandal.
A number of claims companies are launching websites and TV advertising campaigns aimed at borrowers who might think they have been missold their mortgage, according to a report in The Observer yesterday.
The response from readers of Mortgage Strategy, both online and in the magazine, has been that to argue that interest-only mortgages have been missold is ridiculous. I couldn’t agree more – but what we think does not matter one jot!
If these claims firms get a legal precedent set, all it takes is one single case, the flood gates will open.
This could signal armageddon for residential mortgage lending in the UK. I hope they get told where to go but I am really worried about this.
Name and address supplied
Last week Lloyds Banking Group’s director of strategic partnerships Peter Curran revealed that decision-in-principle to application ratios will not form part of any changes Lloyds Banking Group makes to its procuration fee structure.
He says a final decision on whether to pay proc-fees based on quality has yet to be made. But he has ruled out using DIP levels as a metric whilst suggesting that an application to conversion ratio could be used in calculations.
If the quality of business submitted is the route that we are going down, then an additional indicator would be the way the case is packaged, i.e. all initial documents sent in the way the lender wants and the time taken for cases to go to offer compared to others. It’s the poor brokers or occassinal mortgage submitters that do not help the majority of us causing admin log jams and increase lenders costs. More reward should be for those that act professionally not just call themselves professionals.
So lenders like Abbey could take quality into consideration when paying proc fees.
Should lenders go down this route will they also increase proc fees when they mess up a mortgage application, mis-advise advisors on the process or requirements?
Many lenders have made redundant their best staff, what are left in some cases are the new inexperienced staff that don’t have a clue. The consequence is low quality mortgage processing and Brokers with headaches.
Bank of Canada Governor Mark Carney will succeed Sir Mervyn King as governor when he steps down next June.
For the first time in history the job of governor was publicly advertised with the Treasury looking for a candidate with experience of working in a central bank or similar institution, or at a senior level in a major bank or financial institution
It certainly proves that we do not have the required expertise or talent within our own shores. Although that might seem far from ideal it hopefully means that there should be a huge improvement on the current job holder’s lamentable efforts to date.
Mortgage Strategy last week published a story quoting Barclays head of national relationships Sarah Green saying that she would rather use the “millions” of pounds it would take to improve Woolwich’s online booking system to boost mortgage lending instead.
Brokers have criticised the lender’s online booking system for poor usability and the time it takes to process cases.
In January, the buy-to-let system crashed for two days, leaving brokers unable to submit new cases.
I for one have stopped using Woolwich as I need three different passwords to enter in to three different websites to deal with one application.
The funds booking continually asks me for a new password and when you’ve done all that, it takes 8 weeks to get an offer.
Surely those millions of pounds will easily be made up by the uplift of applications submitted from brokers like me that have stopped using them just to keep our sanity and for an easier mortgage application.
In response to Woolwich’s Sarah Green on investing in its system, how long would a few millions of mortgage money last? Not long. How long would a system that delivered an excellent user experience for the broker and encouraged higher business levels last? Donkey years.
Being committed to the broker market does not just mean having competitive rates – we need systems that make life easier and encourage us to do more business with you.
Don’t just rely on the limited availability of funds from other lenders to maintain market share – deliver a service and systems that put you at No. 1 too.
Andy Wilson, Andy Wilson Financial Services