In a video panel debate, Jeremy Duncombe, managing director of Accord Mortgages, said: “It’s not about making assumptions. I don’t think any of us can ‘get it right’ all the time. We can have an understanding of the market and what’s affecting pricing changes, but whether it’s a failed US bank pushing rates one way, or inflation figures that were unexpected pushing it a different way, in the course of two weeks swap rates can move by 60-70 basis points and it just needs one unexpected event to happen and the sentiment of the market can change so much.”
He continued: “You can’t assume there’s going to be a natural glide path over the next six, twelve, eighteen, twenty four months towards lower rates. There will be bumps so therefore the advice you give has got to be client specific based on what they can afford.”
“So it’s about having those conversations, talking to customers, reassuring them but having as much knowledge as a broker as you can so you can explain rather than forecast.”
Duncombe said lending over the past few years has already been stressed to reflect sharp rate rises, so, theoretically, customers can afford mortgage payments at six or seven per cent.
He added: “We’re seeing that fortunately play through in arrears rates. People are paying their mortgages and the vast majority are still on fixed rates which have a period of time to go.”
Duncombe is joined in the first in a series of four videos by Clare Beardmore, director Legal and General Mortgage Club and Stephanie Charman, strategic relationships director, Sesame Bankhall Group and host Victoria Hartley, contributing editor of Mortgage Solutions.
Watch out for the next three episodes in the series, out over the next two weeks on Mortgage Solutions.
