Richard Hey's Blog
As one of our top mortgage advisors, Richard Hey, wanted to share some of the inside information on the mortgage market with our customers.
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Banks told to step up lending
Banks will today be warned that if they fail to resume lending to businesses the government may press the "nuclear option" and force them into full-scale nationalisation. In a strongly worded statement, John McFall, chairman of the Commons' treasury select committee, said banks should be "actively lending instead of sitting on their hands". "Governments have called on them to resume lending, and criticism has been directed to the banks that they are not shaping up to the task at hand," he said. "If the banks do not play ball, then the demand for full-scale nationalisation may well grow." McFall said the strategy had proved successful in Norway, Sweden and Finland between 1991 and 1993.
Source : The Guardian page 38 - 21.11.08.
21 Nov 2008
Post by Richard Hey
Small rise in Mortgage lending
Small rise in mortgage lending
Mortgage lending rose to £18.7 billion in October, up almost 7% on the previous month, according to the Council of Mortgage Lenders (CML). However, with the total 44% lower than in the same month last year, prospects for the housing and mortgage markets remain weak. "Consumer confidence is now being affected by the worsening economic outlook," said CML director general Michael Coogan. "However, any recovery in lending is also being held back by the continuing shortage of mortgage funding." Mr Coogan also called on the Government to publish in the upcoming Pre-Budget Report the Crosby review that has been looking at ways of reviving the mortgage market
Post by Richard Hey
Borrowers expect rate cut
Borrowers appear to be anticipating a cut in the base rate, with the number of variable rate mortgages taken in the past three months having increased 50%. According to Legal & General, 35% of residential borrowers opted for variable rate mortgages in the latest quarter, up from 24% previously. Applications for fixed rate mortgages fell to 63%, from 75%. "Trackers will have attracted greater attention as forecasts of base rate cuts become more prominent," said Stephen Smith, Legal & General's Director of Housing. "The popularity of variable rates has also perhaps been boosted by the number of borrowers sticking with their lender's standard variable rate when they came to the end of a deal, rather than remortgaging straight away."
23 Sep 2008
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Banking stocks Resurgent
Shares have surged upwards as measures announced by the US and UK Governments had the desired effect of restoring a semblance of confidence in world markets. The rebound came following the announcement by US Treasury Secretary, Henry Paulson, that hundreds of billions of dollars of toxic mortgage-related debt will be dealt with by new legislation. Closer to home, the Financial Services Authority's decision temporarily to ban short selling in the stocks of 29 financial companies helped galvanise the FTSE 100 index further. The impact was most notable in financial stocks, with Royal Bank of Scotland and HBOS both up almost 40% by early afternoon. Having been blamed for causing the share prices of various banks to plummet in the past week, short selling on 799 companies in the US has been suspended until 2 October. The Dow Jones leapt more than 3% upon opening on Friday, building on the gains made at the end of the previous day's trading.
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Rate cut edging closer
The minutes of the Bank of England's Monetary Policy Committee (MPC) meeting for September have revealed members voted 8-1 in favour of maintaining interest rates at 5%. The one dissenting voice was David Blanchflower, who called for a reduction of 0.5%. As the August meeting had seen Mr Blanchflower vote for a cut of just 0.25% and Tim Besley favour an increase, opinion appears to be swaying towards a cut in the not too distant future. Members acknowledged that a case could be made for both an increase and a decrease in the rate, but eventually decided to do neither as the medium-term outlook for inflation had not changed.
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Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.