www.mortgagestrategy.co.uk LETTERS
Sponsored by
30-day back to day one policies or
are made unemployed.
This is not true. Whether a
client is receiving payment from an
employer or not should not affect
their ability to claim.
Also, customers may decide on a
longer deferred period or not
depending on their requirements
but apart from receiving pay in lieu
of notice, any other redundancy
packages do not normally affect the
ability to claim – at least not on any
of the policies I provide for my
clients.
DANNY LOVEY
PRINCIPAL
THE MORTGAGE PRACTITIONER
BY EMAIL
Second charge
lenders are fair
to borrowers
A recent article by Nick Pearson,
director of external affairs at
Paymex Group, (Mortgage Strategy
April 27) states that second charge
lenders are too quick to repossess
properties. I have evidence that
contradicts this.
ANALYSIS
uring a recent
conversation with a
senior figure from a Dlarge lender, I outlined
my analysis of where lenders went
wrong in their handling of
mortgage arrears in the last
repossession crisis in the 1990s.
He disagreed with my views, so
I’d like to give my take on the 1990s
and contrast it with the situation
now. Between 1990 to 1995, around
345,000 homes were repossessed,
leading to a slump in house prices
The repossession
crisis then and now
NICK PEARSON
DIRECTOR OF EXTERNAL AFFAIRS
PAYMEX GROUP
The latest crisis has many
parallels but there are differences.
Parallels include poor lending,
rising unemployment and more
properties slipping deeper into
negative equity.
The differences are generally
positives. Interest rates are at a
record low and lenders are being
realistic about allowing borrowers
to spread arrears repay ments over
a reasonable period.
But all is not rosy. Home owner
in arrears have more unsecured
The Finance and Leasing
Association, whose members
comprise 80% of the second
charge market, recorded 1,553
repossessions in 2008 compared
with 40,000 by first charge lenders.
A government review in 2008
found no systemic difficulty with
the way second charge lenders
were seeking to help customers in
arrears.
Repossession is always a last
resort for FLA members. The
association’s lending code and good
practice guidelines are designed to
ensure second charge lenders work
with customers to resolve any
repayment problems.
Also, following the recently
introduced pre-action protocol for
mortgages, any lenders pushing for
repossession that have not explored
all other reasonable repayment
avenues with their customers will
find their cases rejected by the
courts.
FIONA HOYLE
HEAD OF CONSUMER FINANCE
FINANCE AND LEASING ASSOCIATION
BY EMAIL
CML is trying to
shift blame for
chaos onto others
I was agreeing with most of the
comments made by Matthew Wyles,
chairman of the Council of
Mortgage Lenders, at the trade
body’s recent annual lunch until I
got to the final paragraph of your
extract from his speech where he
spoke about unscrupulous
intermediation (Mortgage Strategy
Online April 24).
What a nasty comment by a
●
YOUR NEXT LETTER TO
MORTGAGE STRATEGY COULD
WIN YOU THIS FANTASTIC BOWMORE
12 YEAR OLD SCOTCH WHISKY
COURTESY OF HODGE LIFETIME.
PLEASE SUPPLY FULL CONTACT DETAILS
representative of an industry
desperately trying to shovel blame
onto everyone else for the present
crisis. I would be interested to
know of any examples of this in
Nationwide’s records.
There seems to be a consensus
among lenders that brokers are a
thorn in their sides and that they
could do without the hassle, so this
comment was surprising coming
from one of the few that seem to
have abandoned dual pricing.
Perhaps Wyles should be asking
why a number of CML members
are still encouraging fast-track
applications through brokers and
branch staff.
I’m sick of broker-bashing. It
does nobody any good at a time
when credit is being crunched.
STUART DUNCAN
TAYLOR ENGLEY MORTGAGE SERVICES
BY EMAIL
Abbey BDMs are
so streamlined I
can’t see them
I must comment on the letter from
Ricky Okey, managing director of
Abbey for Intermediaries and
Alliance & Leicester (Mortgage
Strategy April 27).
He states that “there should be
no doubt of our commitment to the
intermediary market as we have
streamlined our BDM workforce”.
This means there are now fewer
BDMs to cover the Abbey and A&L
brands. Has anyone been able to
contact one of these rare species?
MARK JEFFERY
DIRECTOR
MORTGAGES TOGETHER
BY EMAIL
New-build pricing
muddle led me to
pull out of deal
MORTGAGE STRATEGY May 11, 2009 17
Prize may vary from picture
I recently reserved a new-build
property in Warrington with a
property developer at an agreed
price of £361,950.
I paid Barclays £445 to send a
surveyor to value the property for
mortgage purposes.
The bank duly instructed a
surveyor to value the property that
was only at ground level, and on
receipt of the survey I found the
house had been priced down to
£315,000.
I was not sure who was at fault,
the surveyor or the property
developer, so I spoke to both parties
and found the surveyor believed the
property was only worth £315,000.
I spoke several times and also
wrote letters to the developer which
said it would only be prepared to
sell the property at £351,000 based
on a valuation from a different
surveyor – something Barclays
would not accept.
After all this I had to pull out of
the deal and lost £445, as the
developer would not honour the
price of £315,000.
After looking on various
property websites I found that a
similar house on a different plot
sold for £300,000 in January and
that’s why the surveyor valued
mine at £315,000.
I believe the developer knew
this was going to happen but was
still happy for me to proceed in the
hope the property would be valued
upwards. I lost out and so could
many others, in the same way.
HAZEL WAINWRIGHT
BY EMAIL
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