West One Loans widens residential range to Scotland

West One Loans widens residential range to Scotland

West One Loans started lending in Scotland earlier this month, initially through two Mortgage Advice Bureau (MAB) firms.

All brokers registered with West One, including club and network members, can submit Scottish cases to the lender.

Borrowers in Scotland will be able to access the lender’s fast-track remortgage service, which instructs a Scottish solicitor on receipt of the application as opposed to the offer stage. This can be secured on standard remortgages up to £750,000.

The lender has also introduced updated criteria to support “concessionary purchases”, so borrowers can buy from a family member at a discounted price with a five per cent deposit. The maximum loan is calculated at the lower of 95 per cent of the purchase price or the maximum loan to value (LTV).

West One Loans entered into the residential mortgage space in 2022, with Marie Grundy (pictured), managing director of residential mortgage and second charge at West One Loans, telling this publication that going into the residential market was a “natural next step as we build on our already comprehensive product range” and its aim was to be the “UK’s largest non-bank specialist property lender”.

Grundy said: “We’re delighted with how well our residential range has gone down with brokers and borrowers since we launched it in the back end of 2022.

“When we launched into the owner-occupied market, the plan was always to expand into Scotland eventually. We are pleased we are now able to do so – and at scale.”

She continued: “Like the rest of the UK, there is huge demand in Scotland for specialist finance aimed at borrowers who are overlooked mainstream high street lenders.

“Therefore, we are excited to be able to offer another option to those living in Scotland who may have non-standard borrowing requirements or who could benefit from using a lender with a more individual approach to underwriting.”

Stamp duty reform needed to cater for regional variation, Rightmove says

Stamp duty reform needed to cater for regional variation, Rightmove says

According to Rightmove, the percentage of properties for sale that are exempt from stamp duty for all buyers ranges from four per cent in London all the way up to 71 per cent in the North East.

The proportion of properties for sale exempt from stamp duty for first-time buyers goes from 28 per cent in London up to 91 per cent in the North East.

 

Region % of properties for sale exempt from stamp duty for all buyers % of properties for sale exempt from stamp duty for first-time buyers

East Midlands

43 per cent

82 per cent

East of England

22 per cent

62 per cent

London

4 per cent

28 per cent

North East

71 per cent

91 per cent

North West

51 per cent

82 per cent

South East

16 per cent

52 per cent

South West

25 per cent

66 per cent

West Midlands

41 per cent

79 per cent

Yorkshire and the Humber

55 per cent

85 per cent

 

Rightmove has said that a more “localised approach” to stamp duty that was aligned to regional prices would help more first-time buyers onto the property ladder and “encourage more movement up and down the ladder”.

Tim Bannister, Rightmove’s property expert, said: “Stamp duty is a big barrier to moving, with some who would potentially consider a move likely put off by the hefty stamp duty tax in addition to other moving costs.

“At the very least, the government should be thinking about making the current changes to first-time buyer stamp duty charges permanent, with the higher thresholds introduced in 2022 due to expire next year. However, we think there is an opportunity to go a step further.”

He added: “With such regional variations in property prices, increasing stamp duty thresholds in line with these regional variations would seem a logical first step for stamp duty reform. Whilst longer-term supply measures are also needed, this could be one way to help first-time buyers trying to get onto the ladder in more expensive parts of England.”

 

Mortgage innovation should go beyond 99 per cent scheme

Rightmove has also called for further mortgage innovation with schemes that “go further and support a larger group of first-time buyers” than the proposed 99 per cent mortgage scheme.

The company said that figures from the Financial Conduct Authority (FCA) and the Bank of England (BoE) reveal that only five per cent of mortgages currently taken out are 95 per cent loan to value (LTV) or higher, as most save up a larger deposit to benefit from a lower mortgage rate.

Matt Smith, Rightmove’s mortgage expert, said: “It’s been good to see innovation in the mortgage product space over the last couple of years, both from traditional lenders and more recently from new entrants.

“These new products have the good intention of helping renters who want to buy through supporting those with smaller deposits, or enhancing the amount a first-time buyer can borrow through access to longer term fixed rates – removing the stress test.”

He continued: “Each of these new innovations are working to ensure that lenders balance the need to be prudent and comply with complex regulations that govern their affordability criteria, whilst also increasing access to homeownership to more people.

“The proposal for a 99 per cent mortgage product will offer further support for those with smaller deposits, but it doesn’t address the issue of being able to pass an affordability stress test at eight per cent-plus whilst also being inside the four-and-a-half times loan to income (LTI) ratio.

“Whilst we support new solutions to help more first-time buyers, the 99 per cent LTV mortgage alone is only likely to support a relatively small group. More needs to be done to strike the right balance between supporting a bigger group of future first-time buyers, whilst maintaining robust affordability assessments.”

 

Better green home incentives needed

Following the government’s reversal on energy-efficiency measures for rental properties, Rightmove said that there has been a fall in landlords planning to make Energy Performance Certificate (EPC) improvements.

Around 36 per cent of landlords in 2022 said that they planned to make improvements to properties with an EPC rating of C or lower, however in 2023 this dropped to 26 per cent.

Rightmove called for better incentives, saying “more widely accessible grants or tax savings should be considered to help make rental homes greener for tenants”.

Christian Balshen, Rightmove’s lettings expert, said: “Due to the lack of available and accessible funding, many landlords aren’t in a financial position to be able to carry out major energy-efficiency upgrades to their properties.

“A further lack of clarity around potential future EPC regulations means we’ve seen a drop in the number of landlords who are actively deciding to make their properties greener.

“Ultimately, this will be to the detriment of tenants who are increasingly wanting to live in energy-efficient properties, and so we’d encourage any financial incentives that can be provided to landlords to improve the energy efficiency of the UK private rented sector (PRS).”

Skipton BS mortgage advances grow to £6.7bn in 2023

Skipton BS mortgage advances grow to £6.7bn in 2023

According to Skipton Building Society’s latest financial results, it has supported around 40 per cent more first-time buyers, with 19,120 first-time buyers getting onto the property ladder in the last year.

This is equal to one in three of all loans advanced, the lender said.

The firm’s group mortgage balances rose to £28.6bn, equivalent to a market share of 13 per cent.

The mutual said that this was despite the mortgage market being “stagnant for the majority of the year”.

Skipton Building Society added that residential mortgages in arrears of three months or more stayed low at 0.23 per cent at the end of the year. This compares to 0.17 per cent in 2022, but is below the industry average.

An additional £30.9bn of lending has been generated by Connells for UK mortgage providers in 2023, which is down from £36.9bn in 2022.

The company’s underlying group profit rose to £308.6m, an increase from £297.7m in 2022.

Its net interest margin (NIM) rose to 1.53 per cent from 1.35 per cent in 2022, which it attributed to the “rising-interest-rate environment, which created opportunities to generate higher net income that we are reinvesting to deliver further benefits for members”.

 

Track record mortgage reports nearly £30m in completions

Skipton Building Society said that the value of its track record mortgage, which aims to help people trapped in rental cycles get onto the property ladder with a deposit-free mortgage that includes rental history, has been “clearly demonstrated”.

It said that applications had totalled £62.4m since it launched in May and there had been around £29.7m in completions.

The company added that, since it expanded its criteria to previous homeowners, it was helping more renters onto the property ladder.

 

Connells’ revenue pegged at £950.9m

Connells’ revenue for 2023 came to £950.9m, which is a drop of 7.7 per cent compared to the same year last year.

The company said that this was due to a “tougher economic environment” during the period and weaker consumer confidence in the housing market going into the year, which led to a “materially lower sales pipeline”.

The group secured a profit before tax of £13.8m, down from £67.5m in 2022.

Connells said that it supported one in 10 individuals looking to buy and sell homes in the UK, with the number of properties the group exchanged contracts on coming to 70,971. This compares to 87,395 in 2022.

The number of mortgages arranged by the group fell by seven per cent during the period, and the number of properties in its lettings business rose to 125,666 from 122,614 in 2022.

 

Skipton International’s mortgage book hits £2.2bn

Skipton International, which carries out mortgage lending to the Channel Islands and for overseas UK buy-to-let (BTL) investors or those using special-purpose vehicles, reported a 9.6 per cent growth in its mortgage book to £2.2bn.

The firm said that its mortgage book quality remained good, with only four cases in arrears of three months or more. This is up from no cases in 2022.

The company said that pre-tax profits came to £47.3m in 2022, up from £39.9m in 2022, which it said was due to the “benefits to income and margin from the rising-interest-rate environment”.

Skipton International’s NIM rose to 2.37 per cent from 2.2 per cent in the prior year.

 

‘We are committed to continuing to keep pushing for change in the housing sector’

Charlotte Harrison (pictured), CEO of home financing at Skipton, said that the “strong results” were a “true reflection of the hard work, dedication, and the lengths we have gone to at Skipton to help bring real change to the housing market and the mortgage sector as a whole”.

She continued: “In February 2023, I stepped up to become the CEO of the home financing business and, just one year later, I’m extremely proud of what we have already delivered as a business to help support homeowners and first-time buyers.

“From bold product innovation, delivering the UK’s only deposit-free mortgage – Skipton’s track record – providing a much-needed lifeline to tenants stuck renting, enabling them to achieve their homeownership aspirations, through to not passing on the majority of base rate increases to our mortgage variable rate (MVR) and standard variable rate (SVR) customers, ensuring we maintain as a lender one of the lowest MVR/SVRs on the market.”

She added that renaming products, like joint borrower sole proprietor (JBSP) to income booster, would “help more first-time buyers better understand the options that are available to them on the market”.

Harrison said: “However, there is more we can still do, as there are too many people in the UK who desperately feel that they will never have a home of their own – we want to change this.

“Which is why, in the home financing business, we are committed to continuing to keep pushing for change in the housing sector – we’ll continue to hold ourselves accountable and be braver and bolder in our approach to deliver more innovation and take action where it is needed to support more homeowners and help even more people to take their first steps onto the property ladder.”

Exclusive: Acre partners with Paradigm

Exclusive: Acre partners with Paradigm

Paradigm member firms will have immediate access to Acre’s technology which will save them time, improve operational efficiency, and make regulatory and Consumer Duty adherence easier.

The technology can save an average of an hour per case of admin time and simultaneously keep written business consistent and compliant.

The platform brings the whole case process into one place, from onboarding the client and checks all the way through to sourcing and decision in principle (DIP).

Acre says Paradigm members who use Acre will be able to offer a “superior service” to customers.

Paradigm member firms can choose to pay no upfront fee for Acre and pay their costs using the network’s profit share scheme, lowering direct costs to them.

Members can also benefit from Acre’s fairer pricing with platform costs determined by individual volumes and usage.

Justus Brown (pictured), Acre’s CEO and founder, said: “Paradigm understands that having the right technology at your fingertips can transform a business. The year ahead will see technology play an even bigger role in adviser’s jobs. It will be the differentiator between brokerages.

“The right technology delivers a multitude of benefits: advisers are more informed on the best deals for their clients; the mortgage journey is more efficient with a faster route to DIP. With this partnership, Paradigm has clearly recognised the positive change Acre can deliver to advisers.”

Richard Goppy, director of membership at Paradigm Mortgage Services, added: “A key role of Paradigm is to equip our member firms with new technologies that bring significant value to their businesses.

“Acre bring all elements of the client case into one place and allow for one consistent set of data to be utilised at every step, to deliver better outcomes for advisory businesses and their customers. We’re looking forward to working with Acre and sharing the benefits of its technology with our membership.”

The partnership is the latest for the firm, with Acre teaming up with Brilliant Solutions and The Right Mortgage in recent months.

 

 

Nationwide and Virgin Money up rates – round-up

Nationwide and Virgin Money up rates – round-up

The remortgage deals at 95 per cent LTV are priced at 5.84 per cent for a two-year fixed rate with a £999 fee, and its fee-free deal is 6.14 per cent.

Its high-loan-to-value (LTV) like-for-like remortgage three-year fixed rate with a £999 fee is 5.7 per cent, and its no-fee version is 5.88 per cent. Its five-year fixed rates with a £999 fee come to 5.34 per cent, and its fee-free version is 5.49 per cent.

Like-for-like remortgage two-year tracker products are priced at 6.64 per cent with a £999 fee and 6.74 per cent with no fee.

In its new business range, new member moving rates from 60 to 95 per cent LTV have gone up, with pricing starting from 4.64 per cent for a two-year fixed rate, 4.54 per cent for a three-year fixed rate and 4.19 per cent for a five-year fixed rate.

Within its first-time buyer range, rates between 60 and 95 per cent LTV have gone up, with two-year fixed rates beginning from 4.64 per cent, 4.59 per cent for a three-year fixed rate and 4.29 per cent for a five-year fixed rate.

On the shared equity side, which can be used for new members moving and first-time buyers, products at 60, 75 and 80 per cent LTV have gone up, with two-year fixed rates beginning from 4.74 per cent and five-year fixed rates start from 4.39 per cent.

Within its remortgage range, deals from 60 to 90 per cent LTV have increased. Two-year fixed rates are priced from 4.69 per cent, three-year fixed rates start from 4.64 per cent and five-year fixed rates begin from 4.29 per cent.

In its existing business range, existing members moving between 60 and 95 per cent LTV have gone up. Two-year fixed rates start at 4.64 per cent, three-year fixed rates are priced from 4.54 per cent and five-year fixed rates start at 4.19 per cent.

Shared equity deals at 60, 75 and 80 per cent LTV have also gone up. Two-year fixed rates are priced from 4.74 per cent and 4.29 per cent for a five-year fixed rate.

Additional borrowing rates at 60 and 75 per cent LTV have increased, with two- and three-year fixed rates priced from 4.59 per cent and five-year fixed rates beginning from 4.19 per cent.

Switcher rates and switcher additional borrowing pricing start from 4.59 per cent for two-year fixed rates and 4.19 per cent for five-year fixed rates.

It is the second time this month that Nationwide has increased rates.

 

Virgin Money increases rates

Virgin Money has increased select exclusive, core and product transfer rates by up to 0.2 per cent, with the changes coming into force from 8pm on 27 February.

On the exclusive side, its exclusive purchase fixed rates at 85 per cent LTV will be increased by 0.05 per cent, with rates starting from 4.69 per cent.

At 90 per cent LTV, purchase exclusive fixed rates will go up by 0.1 per cent, with pricing beginning from 4.65 per cent. At 95 per cent LTV, the increase is 0.05 per cent, with rates starting from 5.64 per cent.

For remortgage exclusive fixed rates, at 60 and 75 per cent LTV, the increase is by 0.05 per cent with pricing starting from 4.44 per cent.

In its core range, its two-year purchase fixed rates will be upped by 0.1 per cent, with rates beginning from 4.89 per cent.

Within the product transfer range, two-, three- and five-year fixed rates at 65 and 75 per cent LTV will rise by 0.13 per cent, with pricing starting from 4.3 per cent.

Two- and three-year fixed rates between 80 and 95 per cent LTV will go up by 0.2 per cent, with rates starting from 5.34 per cent.

Five-year fixed rates between 80 and 95 per cent LTV will rise by 0.1 per cent, with pricing beginning from 4.94 per cent.

FCA to up pace and transparency in enforcement cases

FCA to up pace and transparency in enforcement cases

The FCA has opened a consultation on plans to be more transparent when an enforcement investigation is opened.

The plans mean the regulator could publish updates on investigations as “appropriate” and be “open” when cases have been closed with no enforcement outcome.

The regulator said that it would “focus on a streamlined portfolio of cases, aligned to its strategic priorities where it can deliver the greatest impact”.

It added that it would also close cases where “no outcome is achievable” at a faster pace.

Currently, investigations are only announced in “very limited circumstances”, the regulator said.

The regulator said that any decision to announce an investigation would be done on a “case-by-case basis” and depend on several factors that will inform whether it is in the public interest.

This includes whether an announcement would protect the UK financial system and enhance its integrity, reassure the public or help other investigations.

The FCA said that announcing an investigation did not mean that the regulator had decided whether there had been misconduct or breaches.

A report in The Financial Times confirmed that the regulator planned to name firms under investigation more frequently and at an earlier stage to heighten deterrence of poor practices.

The changes would also allow companies to start making changes earlier than they are currently able to, the report added.

Therese Chambers, joint executive director of enforcement and market oversight at the FCA, said: “By being more transparent when we open and close cases, we can enhance public confidence by showing that we are on the case.

“At the same time, we will amplify the deterrent impact of our work by enabling firms to understand the types of serious failings that can lead to an investigation, helping them to change their own behaviour more quickly. Greater transparency will also drive greater accountability for us as an enforcement agency.”

Steve Smart, fellow joint executive director enforcement and market oversight at the FCA, said: “Reducing and preventing serious harm is a cornerstone of our strategy. By delivering faster, targeted and transparent enforcement, we will reduce harm and deter others. We will also make greater use of our intervention powers to stop harm in real time.”

‘We’ve got headroom to grow and we’ve got the ambition’, Together CCO says

‘We’ve got headroom to grow and we’ve got the ambition’, Together CCO says

Speaking to this publication as Together celebrated its 50th anniversary, Etchells said that in the lender’s 50-year history, it had made a “continuous profit”, but the changing rate environment in the last few years had been a challenge for all lenders.

“We’re not hiding from the fact that the whole industry had to figure out what [rising rates] meant, and we had to reassess what that rate environment meant. I think we now, since last summer time, as an industry and as a lender, we’ve understood what that now means.

“We’re now looking at how we reduce our rates… because you can see a little bit more the horizon now,” he said.

Etchells said that, over the last 18 months, it felt like walking up the side of the mountain, and all you can see is the slope in front, whereas now it felt like, proverbially, the sector was at the “top of the mountain”.

“I’m not saying that rates are going to come crashing down, but at least we’ve got a good view of what’s going on, rather than just looking at the mountain in front,” he noted.

He added that, regarding becoming a bank or being acquired, there were “never options closed to us”, but it was in a very good position currently.

Etchells said that the lender had a “really strong funding base”, noting that its latest securitisation was six times oversubscribed.

“We’ve got headroom to grow, and we’ve got the ambition. We went from a billion-pound loan book in 2013 to £6.8bn in 2023, so that is significant growth. The ambition is to do that again, and there’s no reason why we can’t do that with our current funding structure,” he said.

Etchells said that its strategy currently, and in the short-to-medium term, was to “continue that growth, continue meeting customers’ needs and continue serving the customers that we’ve got experience in doing so”.

He said that high-street lenders won’t necessarily eye the specialist lending sector to enter themselves, as they are “always trying to find the least point of friction”.

“All the things that they want to be simple, the high street will always try and find the quickest way of doing those. Whereas, what we’re doing is putting the effort into actually understanding customers and understanding those complexities,” he said.

 

Bridging is ‘hero product’

Etchells said that bridging, both regulated and unregulated, was its “hero product” at the moment, which he attributed to the market being very “active”.

He said that, two years ago, Together would have celebrated doing £100m of bridging business per month, whereas now it would be an oddity if it didn’t, adding that it had done above £100m of bridging each month for the last six months.

“That’s where we’re seeing a lot of opportunity and that’s where customers are spending a lot of time and have been taking advantage of a challenging economic landscape to seize opportunities,” Etchells said.

He noted that it also expected there to be a rebound in BTL activity, noting that there had been a “perfect storm” of headwinds in the last few years.

“We’re seeing a lot of ambition with the customers we’re supporting. We’re seeing a lot of returning to that market,” Etchells said.

He continued that residential mortgages would also be another focus for the firm, especially with more people coming off lower fixed rates.

Etchells said that, every year, “customer needs become more and more complex in our eyes” and “become more and more demanding of a lender that’s willing to take the time and understand their circumstances”.

 

Together to launch discount variable rate to help customers coming off fixed rates

Etchells said that a challenge that is already “crystallising” and could become more “challenging” in the coming months was customers rolling off cheaper fixed rates.

He noted that the stamp duty holiday had led to a massive uptick in mortgages, and those had started to expire in Q4 last year, which was expected to ramp up in Q1 and Q2 of this year.

Etchells said that Together was planning on launching a discounted variable rate product in March to “make sure that we’ve got the opportunities to meet customers’ needs to stretch rates”.

“If customers want to retain an element of variability, they’ll go on to a discount variable if that’s what they want, or if they want to be fixed, we can do that as well, but helping customers through challenging periods is a big one,” he said.

He noted that some customers coming off lower fixed rates from high-street lenders may become more specialist.

“We’re not kidding ourselves – if they’ve been with the high street on a one a per cent or more deal, and now the high-street lender is offering them five per cent, no one can deal with that just willy nilly. It’s a big consideration for customers. It is definitely a challenge, but also we’ll need to make sure we support customers with that change in the wider market.”

On the BTL side, he said there was a “structural shift going on in that market” and so it needed to make sure it was supporting customers in identifying high-yield opportunities, supporting portfolio customers with incorporation if needed.

 

Brokers are the ‘lifeblood’ of Together

Etchells said that brokers were the “lifeblood of what we do” and that their importance to the market had grown over the past 10 to 15 years.

“Over the course of 50 years, the relationships we’ve built with [brokers] have been absolutely vital. The way we’ve built our proposition is through feedback with brokers. The way that we go to market is by making sure we’ve got the right relationships with the right brokers.

“I guess the thing that we want them to know is that this is the second half of our 100-year plan. So, we intend to be around and continue to grow and continue to work with our brokers for the next 50 years,” he said.

Etchells pointed to its wide product set and broad criteria as factors that set Together apart, adding that it was “always looking for feedback from the frontline brokers as to how we can develop the proposition and how we can support their customers more.”

“We want to work with every broker that deals with specialist customers, we want to have a relationship with them, and so if there are brokers out there that have customers with special requirements and they don’t deal with us, please get in touch, because we are looking to deal with every broker,” he said.

Bridging has ‘real opportunity to be in the spotlight this year’ – Sealey

Bridging has ‘real opportunity to be in the spotlight this year’ – Sealey

For Hope Capital, January started very promisingly, with plenty of enquiries flooding through the doors. This was fantastic to see, especially following our most successful year in business to date in 2023.

As we all know, inflation reached a record high in 2022, but has gradually been decreasing over recent months, which is great news for brokers and borrowers alike. In turn, rates are beginning to drop across the lending sphere and market confidence is growing.

So, where does this leave the specialist lending industry in terms of helping investors make the most of opportunities in 2024? Despite growing significantly as an industry, bridging finance is still often overlooked and misunderstood, with many brokers still unsure of how their clients can use the sector’s potential.

In 2024, its pivotal awareness of the industry continues to grow, and more brokers recognise the variety of situations this type of short-term finance can assist with.

 

Bridging goes beyond solely chain break

The most obvious reason to use a short-term loan – and perhaps what most people think about when they hear the word ‘bridging’ – is to break a chain in a residential property transaction so someone can buy a property before the existing one is sold. However, bridging extends beyond this and has an important role for investors and developers. For example, investors who are looking to purchase and refurbish commercial property or those who are looking to purchase property at auction and beat the 28-day deadline. Both of these situations can often be difficult and long-winded, which is where specialist short-term loans become the most viable solution.

Bridging lenders are usually able to provide finance much more quickly than mainstream lenders, often in a number of days rather than weeks or months. Most bridging lenders can also be much more flexible, as loans tend to be underwritten individually, meaning they can consider individual borrowers’ circumstances. It also means they can lend on those more complex cases that mainstream lenders often reject. This is key for investors and developers who are looking to make the most of investment opportunities, whether they are for residential, semi-commercial, commercial or land purposes.

However, there are some perceptions – which I would say are misconceptions – about the short-term sector that unfortunately put brokers off at times. One of the most common reasons is around how expensive bridging loans are perceived to be. The reality is that, while rates have aligned to changes in the wider market, they have fallen dramatically over the past few years, so are now considerably lower than they used to be. As with everything, benefiting from using a bridging loan all depends on what the investor aims to achieve and their individual circumstances, however by no means should it be viewed as a last resort.

Ultimately, the bridging sector is extremely versatile, and therefore has a real opportunity to be in the spotlight this year. While the past 12 months have been an eventful period for the property market and there are still a lot of changes happening, we will likely observe more shifts within the short-term lending sector in the coming months. That’s why product innovation and keeping a close eye on the market will be key, which is exactly what we plan to do here at Hope Capital.

Gen H streamlines affordability on income booster deals

Gen H streamlines affordability on income booster deals

Income booster is Gen H’s product that allows a family member to go onto the mortgage, so their income and retirement income can increase the amount of borrowing available.

The lender explained that before the broker had to key in specific financial contributions from boosters which would then inform the maximum loan size clients could secure.

However, the firm’s affordability calculator will now show the maximum loan size for the entire buying group and show what the lender estimates the prospective borrower can afford on their own.

The lender said that the information will “empower brokers to have important conversations around affordability with their clients, helping them to maximise their borrowing without stretching their monthly budgets”.

Gen H continued that after going through affordability, the calculator would present all application products, helping brokers find suitable deals for customers even faster.

 

Age limit ‘ejector seat’ calculation

The calculator will automatically include its proprietary “ejector seat” calculation, which would allow boosters to come off the mortgage before they reach the lender’s maximum age.

This could make the longer mortgage terms available that many buyers need to afford a mortgage, the lender said.

Pete Dockar (pictured), Gen H’s chief commercial officer, said: “To drive real change in the housing and mortgage markets, we need to support both our broker partners and their clients.

“By simplifying our max loan size calculation and providing all suitable products within the calculator itself, we optimise borrowing for even more aspiring homeowners and empower our broker partners to give the best possible advice. The more transparency and information we can provide, the better we’re able to serve our customers.”

 

Artificial Intelligence-powered processing

Gen H recently launched an AI-powered packaging tool, built on Google Cloud, that will automatically analyse and categorise documents needed for mortgage applications.

The company has also been growing its team, recently hiring Karen Appleton as its head of lending, and appointing Dane Clarke and David Jackson as business development managers.

‘Weak economic case’ for big tax cuts in Budget, IFS warns

‘Weak economic case’ for big tax cuts in Budget, IFS warns

Research from the Institute for Fiscal Studies (IFS) suggesting the fiscal outlook has changed since November with outlook for spending on debt interest improving slightly, it was not on track to fall in five years’ time as expected.

It explained that debt interest spending was forecast to be £10bn less in 2028 to 2029 than was expected in the Autumn Statement, which some argue could offer “additional headroom”.

However, the IFS said that high debt interest spending was a “big constraint”, adding that it would expected to be at two per cent of national income, or £55bn a year, above what was forecast pre-pandemic.

It explained: “The fact remains that public sector net debt will barely be on course to fall in five years’ time, and only on the basis of plans for fuel duties, business rates and, in particular, day-to-day spending on public services that are unlikely to be realised. There is therefore only a weak economic case for another sizeable net tax cut in the forthcoming Budget.”

The report explained that the Chancellor’s fiscal rule to get debt falling in the fifth year of the forecast period was “commendable” but was a “badly designed rule”.

“The Chancellor appears to be gaming his own fiscal rule. By pencilling in unspecified spending cuts towards the end of the period, he appears to meet the rule, but he is doing so in a way that will lack credibility and transparency until he tells us where he intends to find those cuts,” it noted.

Martin Mikloš, research economist at IFS and author of the report, said: “In November’s Autumn Statement, the Chancellor ignored the impacts of higher inflation on public service budgets and instead used additional tax revenues to fund eye-catching tax cuts.

“At next week’s Budget, he might be tempted to try a similar trick, this time banking the higher revenues that come from a larger population while ignoring the additional pressures that a larger population will place on the NHS, local government and other services.”

He added: “He might even be tempted to cut back provisional spending plans for the next parliament further to create additional space for tax cuts.

“The Chancellor should resist this temptation. Until the government is willing to provide more detail on its spending plans in a Spending Review, it should refrain from providing detail on tax cuts.”

 

Population growth will lower per-person spending

The report warned that faster population growth, as predicted by the Office for National Statistics in January, could “boost revenues” but make keeping existing spending plans more challenging.

Under the updated projections, per-person spending will come to 0.2 per cent a year, which is down from 0.5 per cent in the Chancellor’s forecast in November.

The IFS said that in order to maintain spending on “unprotected services” a cash top-up of £20bn would be needed and to keep per-person spending an additional £25bn would be required.

The think tank added that lowering the planned growth rate in overall public service spending from 0.9 per cent to 0.75 per cent, which the Chancellor is rumoured to be considering, would add £3bn to cuts to “unprotected areas.”

Tax cuts without reform would be ‘missed opportunity’

The IFS said that “tax cuts without tax reform would represent another missed opportunity”.

It explained: “If the Chancellor is determined to cut taxes and wants to boost growth then better options exist than simply cutting the rates of income tax, National Insurance contributions or inheritance tax.”

The IFS added that stamp duties on the purchase of properties and shares were “particularly damaging taxes” and should be “towards the front of the queue for growth-friendly tax cuts”.

The report added that taxes in 2023 to 2024 would be £66bn higher than they would have been if their share of national income had stayed at pre-pandemic levels.

“Whatever cuts may be announced in the Budget, we are still likely to see taxes rise by a record-breaking amount over this parliament,” the IFS said.