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A view from the floor

An eminent economist once wrote: “What looks like it can&#39t go on for ever usually doesn&#39t.” Looking at the 12 years of mortgage lending recovery since the dark days of 1992 and the ever growing level of consumer debt, we should pause to consider this truism.

Statistical fogs apart, the consensus seems to be that the economy is growing faster than anticipated and that the time for low interest rates has passed. We are moving to a period of rising rates that reflect the need to keep the economy from running ahead of its underlying capacity and investor concerns about government expenditure. Housing and personal borrowing are moving away from occupying a central position in policy making.

Where does that leave the mortgage market? House price increases are moderating, but the underlying volumes of housing transactions do not seem likely to fall; the remortgage market may ease a bit because the differential between past fixed rates and current fixes may not be so immediately attractive; and marginal borrowers will have to rein back or risk arrears as rates rise.

But given the better underlying tone to economic growth and the receding fears of unemployment, this looks like a market ending with a whimper, not a bang. Painfully, it may be the lenders running out of returns and capital, rather than the borrowers pleading for mercy, that call the end to this particular market.

How soon Basle II?


FSA begins registration process for direct authorisation

The Financial Services Authority has launched its authorisation process for mortgage and general insurance firms. From November 3 2003, firms will be able to register for an application pack, which contains redesigned application forms and guidance. The FSA will start accepting completed application forms from mid-January 2004. Mortgage regulation starts on October 31 2004, while […]

The mortgage mole

Feeling the heatIt took around seven hours to recover from that buffet brunch at the Corrinado (Mole, October 27) and Mole couldn&#39t help but chuckle at the location. It seems the Corrinado is also home to Billy Wilder&#39s 1959 cinematic classic Some Like It Hot. The film, which stars Marilyn Monroe as Sugar Kane Kowalczyk, […]

Inhouse offer facilities from Guaranteed HomeLoans

Guaranteed HomeLoans has launched inhouse offer facilities with lending partner GMAC-RFC. John Howard Smith, director of Guaranteed HomeLoans, says: “We are excited to be able to offer this added benefit to our introducers. Having complete control on the whole process, up to and including completion, will not only give us an added edge with our […]

Dunfermline staff member to swim with Tinkerbell the shark

Kate Jardine, who runs the back office in Dunfermline&#39s commercial lending department will join Tinkerbell, a 26-stone tiger shark, and friends in the main tank at Deep Sea World to help fundraise for a local charity. Jardine says: “Sharks and my department are quite similar. In both environments, you have to be aware of what […]


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