My closing lines were – it’s not quirky that we want, but true innovation in the areas of the market that needs it most. So, have we seen this during the last few months?
Since then we have seen Halifax, Precise and Leeds come to market with new product ideas. Halifax reintroduced its Stamp Duty product for a few months and again it was very successful. Not new, but it helps to move the purchase market.
Precise has made a plethora of changes to its criteria across its mainstream, near prime and BTL ranges in the last few months. All the changes are very positive and will provide advisers with plenty of opportunities to place clients they have been struggling with recently.
Their true innovation is the Bridge to Let product. Whilst there have been similar products, this is the first true product that will enable clients to buy with comfort in relation to their exit strategy.
The final lender is Leeds with its Welcome mortgage. We have seen products previously that had zero payments at the start but these normally had a higher rate at the end.
This not only offers a product that has zero interest (very different to zero payment) but also a more than acceptable rate post this period. What I do like is that during the zero interest rate period you are still paying the capital thus reducing the debt, if only minimally, at the start.
What we are seeing though is lenders begin to relax criteria. This is good as it’s more of a drift than a rush for volume against quality. Whilst pricing is so artificial with Funding for Lending monies, we can only assume that the risk teams still have their hands firmly on the tiller.
Let’s remember though; it’s not only lenders that can be innovative, advisers can be too in how they use the products available to them to help their clients.
Martin Reynolds is chief executive at SimplyBiz Mortgages
