LV launches equity release drawdown product and adviser portal
The LV Equity Release Portal allows advisers to produce key facts illustrations and submit and track lifetime mortgage applications online.
The Lifetime Mortgage Drawdown + lets customers take out a minimum initial loan of £10,000 with further drawdown payments available from £1,500 to £70,000 if they are needed.
Withdrawals can be taken out monthly provided they do not exceed the maximum loan value. The minimum property value accepted is £100,000 and the maximum loan is £500,000.
With the drawdown product, seven tiers of lending are available. They include Lite, Standard 1, Standard 2, Standard 3, Max, Platinum and Platinum Plus.
Annual equivalent rates range from 2.68 per cent to 3.7 per cent, while monthly equivalent rates vary from 2.65 per cent to 3.64 per cent.
The maximum loan to value (LTV) available is dependent on the age of the borrower and the increases for each borrowing level.
Borrowers can also make flexible repayments with the Drawdown+ product and after the loan has been running for 12 months, customers can make up to six repayments each mortgage year, totalling 10 per cent of the total amount of loan advances without having to pay an early repayment charge (ERC).
Clive Bolton (pictured), managing director of savings and retirement at LV, said: “The launch of the LV Lifetime Mortgage Drawdown+ and adviser portal is a significant development.
“We have listened to feedback from customers and advisers as launching an online portal makes it easier for them to submit and manage equity release applications.”
NatWest BDMs to review self-employed borrowers before application
The bank now wants brokers to discuss the application beforehand so it is able to go through minimal complications and ensure it fully understands the circumstances of each client.
NatWest Intermediary Solutions said: “We are working hard to make sure we understand our customers circumstances given the impacts of Covid-19.
“In this context we are putting in place some additional support for brokers to help us underwrite self-employed customers.”
This update signals a further tightening of NatWest’s processes, as yesterday it announced it would not accept remortgage applications from borrowers who were on a mortgage payment holiday.
Property professional salvages £325,000 deposit with Aspen bridge
The client started a term finance application during the pandemic and risked losing the deposit they placed in 2018 after the application was delayed.
The client approached Winston Hastroodi, relationship manager at Capricorn Financial Consultancy, an appointed representative of Commercial Finance Brokers UK, who introduced the case to Aspen.
Harry Baker, credit manager at Aspen Bridging, oversaw the case from start to finish.
A fully costed illustration was issued within 15 minutes and a decision in principle was submitted in one hour. Legals and valuations were instructed the next day following authorisation from the broker, undertaking was then received same day.
Meetings to update the client were also held over Facetime.
The loan was completed at a flat rate of 0.89 per cent per month with no fees over 12 months and was secured on the luxury property near Albert Embankment.
Baker said: “Covid-19 is still causing disruption to normal practices, and this swift purchase would not be possible in the timescale without our agreed remote signing and witnessing agreements for international clients.”
FCA ‘virtue signalling must stop’ – UK Mortgage Prisoners
Last week, the regulator launched a consultation paper which said it was considering delaying capital repayments for interest-only borrowers until 31 October 2021 if needed.
It is also proposing to would make it easier for lenders to offer switching options to consumers who are in a closed book within the same financial group as the lender, by allowing them not to undertake a standard affordability assessment when doing so.
UK Mortgage Prisoners said as these were not compulsory for lenders it would not help those who have no repayment vehicle or those who have been affected by high interest rates.
The group said conflating inactive lenders with unregulated ones was problematic as it obscured the harm faced by those who had mortgages with lenders who were outside regulatory perimeters and able to set their own rates.
“This virtue signalling must stop,” UK Mortgage Prisoners added.
“Our members need capped standard variable rates, access to the competitive market, and for their homes to stop being sold to these vulture funds.”
In its response, the All Party Parliamentary Group (APPG) for Mortgage Prisoners said the relief would be temporary and suggested the FCA update its guidance so interest-only customers are offered a full range of deals at the end of their term.
Seema Malhotra MP, co-chair of the APPG on Mortgage Prisoners, said: “The APPG has in the past called for banks to be forced to apply streamlined affordability tests when allowing mortgage prisoners to switch to better deals offered by the same banking group.
“The proposal from the FCA to allow firms to use a streamlined approach when a mortgage prisoner is switching within a larger group is welcome but the only way in which it is going to help mortgage prisoners is to make it compulsory.
“Unfortunately, what is glaringly missing here is any help for the tens of thousands who are caught with vulture funds, and who have no hope of accessing better deals with their existing provider unless the FCA intervenes to cap interest rates.”
Ipswich Building Society appoints head of mortgage sales
Grimshaw (pictured) is CeMAP qualified and has spent eight years working in building societies.
Her last role was senior account manager at Family Building Society and before that she was intermediary development manager at Marsden Building Society.
Her role at Ipswich BS will see her interact with intermediaries, networks and clubs, while overseeing the society’s business development management function.
Richard Norrington, chief executive of Ipswich Building Society, said: “We know just how important intermediaries have been to lenders and to their customers during the coronavirus crisis, and with Charlotte’s help we look forward to even closer intermediary relationships in the future.
“Through Charlotte’s appointment, we have been able to increase our market presence for networks and intermediaries, and have restructured our internal sales team to ensure we give maximum support to our business development function.”
He added: “While we are not currently conducting visits or hosting our popular knowledge share events, wherever possible, we have been maximising telephone and digital contact with our intermediary partners to equip them with the information they need to best serve their clients.”
Emma Hollingworth leaves Bluestone
Hollingworth joined the lender in November after leaving Mortgage Advice Bureau where she was strategic partnership director for nearly three years.
Her main role at Bluestone was to strengthen the lender’s relationship with its intermediary partners and during her time she was tasked with enhancing the end-to-end journey between brokers and their clients.
Hollingworth departed her post on Friday and it is unknown where she will be moving on to.
Steve Seal, managing director at Bluestone Mortgages, said: “It is with regret that I have to confirm that Emma Hollingworth has left the business. I would like to thank Emma for her dedication and commitment to Bluestone during her time with us.
“She has been enthusiastic in driving the development of Bluestone’s sales and distribution strategy and strengthening our intermediary relationships while championing the evolution of the specialist lending market.”
He added: “We are grateful to Emma for everything she has achieved within the business and wish her every success for the future.”
Mortgage Solutions has contacted Hollingworth for comment.
Melton BS allows brokers to make product transfer changes
Where appropriate, brokers will be able to make changes to the length of a mortgage term and change the repayment type.
The update will be effective from today.
Existing customers of the Melton Group can transfer their mortgage up to three months before the end of the term, either direct or through a mortgage broker, with no application or completion fees.
Brokers will receive a 0.25 per cent procurement fee for each product transfer.
Dan Atkinson, head of sales and marketing at the Melton, said: “Allowing brokers to make variations gives them the flexibility to advise clients on the full picture when they are considering a product transfer.
“It also creates an additional submissions channel and valuable further business opportunities for brokers.”
New homes to receive automatic approval in planning overhaul
Writing for the Sunday Telegraph, Jenrick announced a new process to speed up the delivery of new homes and places for growth, renewal or protection.
Automatic approval will also be extended to hospitals, shops and offices. Protected land will include Green Belt areas and areas of outstanding natural beauty.
He wrote: “Under the current system, it takes an average of five years for a standard housing development to go through the planning system – before a spade is even in the ground.
“So this week I am bringing forward radical and necessary reforms to our planning system to get Britain building and drive our economic recovery.”
Jenrick said environmentally friendly homes which will not need to be retrofitted in the future will be developed, as well as homes with nearby green space and open parks.
The reforms will unlock land and opportunity, provide housing for the vulnerable and bridge the generational divide of ownership, Jenrick wrote.
He also insisted the reforms would be “cutting red tape, but not standards”.
These changes come after prime minister Boris Johnson announced plans to build new homes in May to help the economy recover from the coronavirus pandemic.
However, critics have cited that many thousands of properties are granted planning permission but never constructed.
Homeless charity Shelter warned that relaxing the rules could lead to poor quality properties and added that 280,000 homes received permission in England between 2011 and 2016 but were never built.
Furloughed workers three times more likely to default on payments – Which? survey
The survey of 2,129 consumers found 13 per cent of those who were furloughed, put on enforced leave or given reduced hours due to the pandemic reported having defaulting on a payment compared to four per cent of those who were still working as normal.
Of the furloughed respondents who were renting or holding a mortgage, five per cent had defaulted on a housing payment.
Some seven per cent of this group defaulted on a bill, and six per cent had defaulted on a loan or credit card payment.
The default rates for bills, as well as loans and credit cards, are more than double that of those who are still working as normal.
This survey comes as the Financial Conduct Authority called on lenders and firms to consult on what additional support might be needed once the job retention scheme and pandemic-related mortgage holidays end.
Changes to spending
The research also showed that 60 per cent of those furloughed, put on enforced leave or given reduced hours made one or more changes to their spending patterns in the last month compared to 42 per cent of those working as usual.
Some 34 per cent cut back on essential spending, 31 per cent have taken money from their savings and 14 per cent have used an overdraft.
The results indicated that furloughed workers were taking more steps to manage their finances compared to those who were still working normally.
Which? said this showed there was a disparity between the two groups which could widen further once government support is withdrawn.
Richard Piggin, head of external affairs and campaigns at Which?, said: “Despite extensive action being taken by the government and the banking industry, it’s very worrying that people currently on the furlough scheme have reported experiencing much higher levels of financial difficulty than those who are working as normal.
“With just a couple of months until the scheme comes to an end, there is real concern that this gap could widen even further.”
He added: “The FCA is right to take steps to consider the additional support required and the industry will also have to ensure consumers are provided with the help they need if they are in financial difficulty.”
‘I’ve turned away 15 cases because of EWS1 issues’ – Star Letter 31/07/2020
Both were in response to the article: Fewer than 300 fire inspectors to conduct EWS1 inspections
Spinmeister said: “I’m no longer taking applications unless an EWS1 form is present.
“So far I’ve lost or turned away about 15 cases and I’m still waiting to see a single one with a completed certificate.”
“Anything leasehold except a maisonette, is being told not to waste their time. I’m sure the stamp duty suspension will be a great relief to those who are now effectively prisoners in their own flats.
“The Royal Institution of Chartered Surveyors (RICS) will singlehandedly be responsible for 20-30 per cent of the London housing stock becoming unsaleable,” Spinmeister added.
Lack of inspectors will cause five-year wait
Arron Bardoe commented on how a lack of qualified fire inspectors could cause a wait of five to eight years for those without the EWS1 form.
He said: “Now some surveyors are insisting on an EWS1 for all flats regardless of height and regardless of whether there is cladding – most of us will have been asked for an EWS1 with a tick in box A to confirm there is no cladding – the lack of inspectors will leave many people with unsaleable and unmortgageable properties until there is reform of the rules.”
Bardoe added: “To estimate the effect, I searched for the housing mix in the UK and focused on purpose-built flats which are most likely to be affected as opposed to houses converted flats. That said, ‘conversions’ would include offices and factories, so I may be underestimating.
“Apparently, there are around 25 million households in the UK and 12 per cent of these are purpose-built flats, so around three million households. If one assumed 10 units per block that gives 300,000 buildings that might require an EWS1.”
Bardoe continued: “With 300 inspectors, this requires each to inspect 1,000 buildings, test any cladding and prepare reports – say one to two days per property at best, especially when including travelling. Inspectors will also want to take weekends off and holidays and may need to attend CPD regularly.
“Added to this current workload will be all new developments; any property that has any changes to its exterior – which automatically requires a new EWS1 – and those with cladding that requires remedial.
“Let’s not forget that, even when the first run is completed, these reports need to be renewed every five years, even for properties without combustible materials.”
“My rough guess therefore is this whole process will take five years.
“People living in purpose-built flats will be able to move or remortgage sometime between now – if they are lucky enough to have an EWS1 – and 2028 if they are at the back of the queue,” he concluded.