There is much speculation currently on when we will see interest rates increase.
Having been lucky enough recently to be in the USA, Italy and Brussels, and spend time with some senior UK economists, views are, as usual, divided.
What is becoming clear is that there are massive regional issues.
While Germany and BRIC nations (Brazil, Russia, India and China) are seeing robust growth, the rest of us, including the USA, are in a much more precarious position.
Economic growth in the UK is just not happening and, with 4% plus inflation and increasing taxes, the signs are not good. Indeed, it looks more likely that we will see more quantitative easing than an increase in rates.
That is not to say that there are not remortgage opportunities out there. However, they will be much harder to find and to place.
The hot money is that, barring unforeseen accidents (and that would not include a Greek implosion), the first possible increase in the Bank of England base rate will be April 2012. Perhaps, even later in the year is probable.
The other hot topic recently has been the FSA unburdening itself on a host of mortgage topics.
Having completed a review of lenders’ anti-fraud measures, it appears that, while the evidence pointed to a range of issues, much of the commentary indicated that it was brokers who are to blame.
This from a regulator that watched all this happen and is still in denial over its culpability.
Having tightened up identification matters and moved to evidencing income for all loans, there is one remedy that will move us significantly further forward – individual registration.
AMI has called for the compulsory registration of all involved in selling and arranging mortgages for many years.
This key fraud reduction measure has been deferred by the FSA, but sometimes a regulator needs to help its industry.
I keep repeating that income fraud might get an individual a house they cannot afford, but perpetrating the most significant frauds that lead to the very big losses needs the collusion of one or both the solicitor or valuer.
The focus on the broker and not those who actually assist organised crime looks like an easy way out.
The delay in producing revised draft rules on the Mortgage Market Review (MMR) is also a concern.
While it is essential that we get this right, firms need certainty to plan their future and we do not have very much of that today.
AMI is fully supportive of the FSA getting the MMR into the right place, which will be recognition of the importance of advice, more flexibility around affordability assessments and a level playing field for all participants.
Robert Sinclair is director of AMI
