OneFamily offers flexibility over interest repayments on lifetime range
The criteria change is only available to new customers.
The lender said half of the lifetime mortgages taken with OneFamily were already used by homeowners who pay off interest. Of these existing customers, over a third pay off both some of the capital and interest up to a maximum of 10% of the original loan value each year and 16% choose to pay off up to 100% of the interest.
The lender said this demonstrates that the majority of customers would prefer to have the option to pay off interest.
Nici Audhlam-Gardiner, managing director of Lifetime Mortgages, said: “By giving our customers the option to pay off the interest on their loan we are giving them increased flexibility.
“We know that our customers’ financial circumstances change, and we want our products to be able to flex with their needs. For example, we’ve seen cases where customers have been left an inheritance by a friend or older family member, and they want to be able to make a payment on their loan. This new approach helps with this situation.”
OneFamily’s lifetime mortgage range is available on either a fixed, two year fixed or variable rate basis.
In September the lender appointed Denise Saber as lending consultant to broaden its range of funders and raise the profile of equity release as a sector among investment managers for retail and institutional pension funds.
Hampshire Trust Bank appoints Matthew Wyles as CEO
Wyles was also chairman of the Council of Mortgage Lenders for two years during 2009 and 2010.
Robert Sharpe, who became Hampshire Trust chairman in September, said: “I am truly delighted the Hampshire Trust Bank Board has secured the services of Matthew Wyles as the Bank’s next CEO following Mark’s decision to retire.
“Matthew is a practitioner well known in the retail and small business banking circles for achieving outstanding results.
“He is exactly the right person to provide the stewardship, entrepreneurial insights and the leadership to successfully steer the bank through the next stage of its development and growth.”
Wyles said: “Specialist banks are already fulfilling a key role in broadening choice for personal and business customers.
“They also play an important and growing part in making the UK economy more productive and efficient.
“Hampshire Trust Bank has already made significant progress since its acquisition by Alchemy in establishing its position as an emerging challenger – it has tremendous development potential.
“I am thrilled to have the opportunity of leading the management team to build an exceptional business on the strong foundations which are already in place.”
Hampshire Trust offers asset, property and specialist mortgage finance to individuals and small to medium enterprises (SMEs) as well as savings accounts.
Previous CEO Mark Sismey-Durrant confirmed his plans to retire in September last year, as soon as a successor could be found, after joining Hampshire Trust in 2012.
HSBC offers 60% LTV tracker at 0.99%
The 0.99% two-year tracker, comes with a £999 fee, or £749 for existing HSBC Premier or Advance customers, and no early repayment charge.
The rate cuts are across the full LTV range from 60% to 90% LTV and the bank’s two-year and five-year fixed rate fee free mortgages.
Tracie Pearce (pictured), HSBC UK’s head of mortgages, said: “We were the first to break the 1% mark last year with our two-year fixed rate mortgage, and we are now going sub 1% with our two- year tracker mortgage.
“For those looking to purchase now, these rates offer great value, making home buying or remortgaging more affordable.”
Tesco Bank launched a 60% LTV variable loan on the 6 June at 0.98% with a fee of £1,495 which is the lowest-ever variable rate for the market.
HSBC also emerged top of a global banking survey, dictated by capitalisation and its move into the intermediary market meant partnerships with 19 distributors by May with plans to have the whole of the Appointed Representative market by year-end.
Pearce confirmed exclusively to Mortgage Solutions its new broker website platform is due to launch in Q4.
Principality’s broker arm wins national customer service award
The society’s intermediary team were praised by their brokers for being ‘efficient, friendly and helpful’ and received two stars from IIC which is categorised as ‘outstanding customer experience’.
The IIC survey of brokers and staff praised the building society’s intermediary team for:
• Being easy to do business with and low customer effort required
• Being competitive, offering rates that stood out in the market
• Treating customers fairly and giving good service support
• Taking ownership of issues and being proactive in responses
• Keeping brokers well-informed during application process
Shaun Middleton (pictured), head of intermediaries at Principality, said: “It’s a wonderful achievement to be the first building society to receive this IIC accolade for customer service. The team have been committed to finding out what our brokers want from us and they have made every effort to deliver an outstanding service. The feedback from our broker network is a fabulous endorsement of how we’ve embedded our cultural values into our customer service strategy.”
Tony Barritt, managing director at Investor in Customers, said: “We are delighted Principality has become the first building society to win an Investor in Customers award. The results clearly show their commitment to putting the customer at the heart of their business and identifies how they can improve their customer experience even further.”
Principality Building Society will introduce 0.2% retention procuration fees for mortgage advisers later this year.
With a start date to be confirmed, it will pay the fee to intermediaries for recommending a product transfer.
Principality is the 19th biggest lender in the UK according to most recent figures with a 1.2% market share.
Ex-broker forges mum’s signature on mortgage to impress girlfriend
Greig Thomson, 38, committed the fraud in May 2007 when he had just become a self-employed mortgage broker and adviser and was deemed too big a risk by lenders.
According to reports, Thomson used the mortgage to buy a flat in Dundee for £180,000, which he later admitted to police was done to impress a then girlfriend.
However, he was unable to maintain regular payments on it and fell into arrears.
Thomson never told his mother, Maureen, that he had used her identity to purchase the flat.
She only became aware of the fraud in 2014 when it was repossessed and sold for just £126,000.
She received a demand for the outstanding £80,000 and after questioning this, received paperwork showing her forged signature on the application.
Fearing she may have her own home repossessed, Maureen Thomson informed the police.
Hearing the case at Dundee Sherrif Court, Sherrif Alistair Brown warned Greig Thomson that he potentially faced a prison sentence for the crime.
Thomson gave up mortgage advising in 2014 and now owns digital marketing firm Outside Media Group.
Sentencing will take place on June 15.
FCA broker fees calculator for 2017/18 goes live
Mortgage brokers could see their fees slashed by 10% following the consultation published yesterday.
However, intermediaries falling into the wider advice category face a 4.7% hike in their levy. (See table for full details.)
The regulator has raised standard minimum fees by 1% to match inflation.
The calculator can be found at: https://www.fca.org.uk/firms/calculate-your-annual-fee/fee-calculator
TMA mortgage club director David Copland said: “The FCA fee calculator will give firms looking to determine their costs for the next financial year an accurate idea of how much they will be charged.
“The calculator is based on consultation rates issued over the last few days, but is subject to change until the consultation paper on the way it’s charged closes in June.
“In any case, it is an opportunity for directly authorised brokers to get a realistic picture of how much they will be charged in 2017/18.”
Mortgage advisers’ FSCS fees revealed
However, those who sell protection products such as life insurance face paying their share of the £147m bill for advisers in the life and pensions class.
FSCS chief executive Mark Neale warned that the regulator would initially raise a levy of £100m in this sector but could then raise a supplementary levy depending on claims throughout the year.
TMA Mortgage Club has been campaigning for the FSCS to change how mortgage brokers are treated under the levy – arguing the current system is unfair.
Under the current system, advisers are billed for the estimated amount of compensation required for a class of products which they are responsible for giving advice for.
However, life insurance has been placed in the same class as pensions, which means that when bad pension advice is given mortgage brokers who sell life cover have to pay up.
An FSCS consultation on restructuring the levy closed on 31 March.
Brokers in the Home Finance Intermediation class will see their contribution unchanged.
“Although we had levied in January for an unexpected spike in claims on this class, these were attributable to one particular failure and do not appear to represent a trend,” the FSCS said.
The Life and Pension Intermediation levy has decreased by £24m from the indicative forecast published in January.
The FSCS said this was largely because of a lower average compensation cost for Self-Invested Personal Pension (SIPP)-related claims.
“Approximately 93% of the costs in this class are for SIPP-related claims and the forecast average claim value has reduced from £36,000 to £32,000,” it said.
“The forecast costs for the sector in 2017/18 are now expected to be £146m, which is £17m below the indicative figure of £163m. The costs for 2016/17 have decreased by £9m since the supplementary levy was calculated for the same reason,” it added.
The evolution of robo-advice
The financial services sector doesn’t tend to do technology well. Factors such as poor collaboration between major players, excessive and often stifling legislation, and a mistrustful and fatigued user base present a sector ready for some good old-fashioned disruption.
Consumer facing robo-advice has slowly become an entertaining if somewhat tired example of Luddism. On one side, there are the innovators who recognise an opportunity to modernise financial advice by creating and catering for new acquisition channels, servicing clients more cost-effectively.
Online interaction continues to increase and new purchasing and servicing behaviours begin to emerge and evolve.
On the other hand, there are those who claim that people are neither interested or want the ability to transact in anything but a face-to-face scenario.
Certainly, while individuals are willing to embrace new interactions online, the lack of mass adoption of robo-advice services points to an unproven model.
From my rather low vantage, robo-advice within the intermediary sector can be broken into two parts: through a provider offering a simplified product set where the user journey is controlled or by providing a more rounded solution that is abstracted away from the providers. Towards the latter option, machine learning is bounded around with the promise of a more intelligent option that is closer to the advice element than the far more unpleasant robo.
Unfortunately, the issue with machine learning is that it is ultimately a reactive tool basing its decision-making on a set of probabilities and confidence levels where, certainly in financial services, the decision endpoints are continually evolving. The key is the curation and the structuring of the data but getting that right is a science in itself.
But what happens when it doesn’t work? When we disagree? Or even we’ve been unfairly judged by the much-vaunted algorithm?
Shake and bake
Help is at hand from the General Data Protection Regulation that is due May 2018. (It’s worth noting that 2018 is dropping a load of legislation affecting the fintech sphere, more on that another time.)
Within the act is the right to object to automated decision making, where there should be “suitable measures to safeguard the data subject’s rights and freedoms and legitimate interests, at least the right to obtain human intervention on the part of the controller, to express his or her point of view and to contest the decision”.
Which in my very unqualified opinion means that robo needs to bake in the ability to qualify and justify decisions, along with the ability to provide alternative methods to service. Why? Because software works in absolutes and there’s always a goodly portion of grey between the black and the white.
West One Loans partners with Black Book Finance
The move will see West One Loans’ range of bridging products offered to mortgage intermediaries and financial professionals through Black Book Finance.
Launched last November by Michael Clapper, Black Book Finance offers a selection of distribution models across a range of specialist financial services.
Stephen Wasserman, managing director of West One Loans, said: “We are very pleased to add Black Book Finance as a strategic partner. We pride ourselves at being at the forefront of the industry, boosting the availability and competitiveness of specialist financing options for the property market, and this partnership will help us continue with this.
“Michael played a crucial part in our group’s history, and we are excited about the opportunity to once again work with him and the team at Black Book Finance, to offer bridging finance to their rapidly growing network of intermediaries.”
Broker mortgage market hit £14.1bn in February
Its analysis of the intermediary market found residential sales hit £11.8bn and buy-to-let sales £2.3bn last month.
The average value of a residential mortgage in February was £193,078 (compared to £191,757 in 2016) and £152,239 for buy-to-let.
Equifax Touchstone director John Driscoll said: “Following a volatile end to 2016 the mortgage market saw a vast increase in sales last month in every region across the UK.
“As the UK moves towards triggering Article 50 we will watch with great anticipation to see how the market responds, and whether there will be a noticeable impact on mortgage sales.”
North Yorkshire led the way for the highest regional mortgage sales growth in February with a 27.9% increase compared to January, while Scotland and the Midlands followed behind with notable growth of 26.8% and 25.4% respectively.
The North East saw the lowest growth with 16.2%.