Skipton BS brings out new-build help desk to support brokers
The mutual said setting up the team and the help desk came following feedback for the “need for broker education and familiarity in the new-build market”.
It said the team would be on hand to answer broker queries on new-build cases, and would be open to calls between Monday and Friday from 9am to 5pm.
The team will support enquiries or pass it on to one of the four new-build help desk underwriters.
The mutual said that depending on the complexity of property enquiries, the team may need to speak to panel surveyors for guidance, in which case a timescale would be agreed and updates issued.
Rachael Hunnisett (pictured), Skipton’s national accounts and new build lead, said that the mutual was “committed to supporting the new-build market” and she was delighted to launch the help desk which would be a “dedicated resource to support brokers with complex new-build enquiries”.
Paul Fenn, head of business development of Skipton Building Society, said: “As part of Skipton’s growth plans and aspirations to become a top 10 lender, expanding our broker support to include a dedicated new-build help desk is a fantastic addition to our lending proposition.
“This comes after we have already expanded our business development manager (BDM) team and made multiple criteria enhancements this year, showing our continued commitment and support to the intermediary lending market.”
Skipton appoints BDM for London
Sparkes, from Ashford in Kent, has had a long standing career in financial services and moved into mortgage broking after she completed her CeMAP 1.
She worked as a mortgage and protection adviser at Just Mortgages for two years, before moving to Hawke Financial Services in an identical role for nearly two years. Sparkes has a solid background working with building societies, which is one of the reasons she has chosen to return to the sector with Skipton BS.
Sparkes (pictured) said: “I am excited to be starting my new role with Skipton. I can’t wait to get out in the field and start meeting brokers.”
“Ever since I bought my first home, I wanted to know the ins and outs of buying a house. It was such a stressful experience and I wanted to try and help people get through the stress and be that person to help them. My background in broking will help me empathise with brokers and look at the policies and criteria that will really help them get their clients into their dream homes.”
John Scrivens, business development manager, added: “Grace joins the team at an exciting time as we’re continuing to expand our pool of BDMs to support the intermediary market, as well as furthering Skipton’s ambition to become a top 10 lender.”
Shared ownership predicted to grow but more awareness needed – Just Mortgages
Lenders and housing associations speaking on panel sessions at Just Mortgages’ inaugural new build and affordable housing event said brokers should prepare for an increase in shared ownership enquiries, especially as Help to Buy is due to end next year.
Furthermore, they said housing associations are expected to build more shared ownership houses and increasing numbers of lenders are predicted to enter the space.
However, panellists said there needed to be more consumer awareness and understanding of shared ownership, so brokers had a key role to play in educating borrowers.
Panellists also noted that there were multiple affordable housing options which borrowers should consider, including Deposit Unlock, private equity loan schemes, the mortgage guarantee scheme and First Homes scheme.
Lenders speaking on the three panel sessions during the day included Barclays, Halifax, Nationwide, Santander, Leeds Building Society, Skipton Building Society, Kent Reliance and Kensington Mortgages.
Housing associations and property providers on the panels included Sage Housing, SO Resi Partnerships, NU Living and Swan Housing.
John Doughty, financial services director at Just Mortgages New Build Division, said: “Lenders and brokers are getting less Help to Buy enquiries from customers as restrictions were introduced a year ago and the scheme nears the end of its shelf life. Instead, we are talking to more people wanting to know if they are eligible for shared ownership.
“I would like to take this opportunity to thank all the lenders, housing associations, property providers and developers for their participation in our event during what was a thought-provoking and successful day.”
Shared ownership currently accounts for two per cent of housing stock and the government has pledge funding for up to 90,000 new shared ownership properties over the next five years.
Skipton BS appoints Ian Cornelius as interim group chief executive
Cornelius will take on the role from 26 April, with Cutter due to step down on 25 April.
It was announced in January this year that David Cutter would step down as group chief executive at the mutual’s AGM in April.
Cutter had been the mutual’s group chief executive for 13 years, and spent 30 years at the business overall.
Cornelius was appointed to the board in 2012, and in his role as commercial and strategy director he oversees implementation of the mutual’s proposition and development of products and services.
Prior to working at Skipton BS, he was commercial director at HML for nearly two years and before that director of banking at Virgin Money for just over a year. He has also held roles at Bradford and Bingley and Capital One Bank.
Skipton Building Society said that it was still in the process of “recruiting a high calibre permanent successor”, who had the “skills and capability to lead a complex and diversified business”.
The mutual reported a 20 per cent annual rise in its gross mortgage lending, which came to £5.4bn in 2021. Its mortgage balance also grew by 6.8 per cent in 2021, which is slightly down from 8.6 per cent growth the year before.
Skipton Building Society’s results also showed growth in first-time buyers and buy-to-let mortgage segments.
Skipton BS changes BTL criteria to include new build flats and cuts stress rate
It has also reduced its stress rate for long-term fixed BTL rates and increased its minimum BTL property value.
Skipton said that it would lend on BTL new build flats up to 75 per cent loan to value (LTV).
It added that it has lowered the stress rate for landlords on five-year fixed rates or longer from five per cent to 4.5 per cent.
The minimum BTL property value has also risen from £50,000 to £75,000.
Tony Field, sales director at Dynamo, said: “The introduction of lending on new build flats is a very positive move that will undoubtedly be broadly welcomed by investors in the sector.
“With stress rate calculations also decreasing and greater flexibility being allowed on terms, Skipton are demonstrating their support of the landlord community and the wider Buy to Let market.”
John Scrivens, regional manager at Skipton Building Society for Intermediaries, added that the mutual regularly sought broker feedback, and recently the topic of energy efficient property was becoming a “regular conversation point with landlords”.
He added: “It’s exciting that we are entering the new build flat market for BTL while keeping things simple by lending up to 75 per cent on them too, in line with our maximum LTV’s on BTLs.”
Lenders ‘broadly supportive’ of Homes for Ukraine but mortgage implications unclear, brokers say
The Homes for Ukraine scheme was launched earlier this week and allows individuals, charities, community groups and businesses in the UK to house Ukrainian refugees. As part of the scheme it offers a £350 month thank you payment to sponsors and the minimum period is six months.
A website to register interest in the scheme was launched by the Department of Levelling Up, Housing and Communities on Monday.
A government spokesperson from the Department of Levelling Up said that over 100,000 people had registered their interest in the scheme since it was launched. However, they said it currently did not have a breakdown of how many of those were mortgage borrowers, but that data may become available in due course. They added that the scheme was open to all applicants, which included landlords.
On its website it says that in “some cases” people will need to check with their landlords, freeholder, mortgage provider and insurance company.
“It’s important you think through any possible implications for your tenancy, mortgage, lease and insurance before your guest arrives in the UK,” it said.
It continued: “Lenders have committed to enable as many borrowers as possible to participate in the scheme. If you have a mortgage on the property you will need to contact your mortgage lender. We are working with the mortgage lender sector to standardise and simplify this process as far as possible.”
Varying views on lodger criteria
Dina Bhudia, managing director and chief executive of P2M Asset Management, said she had already received calls from customers asking about the scheme.
However, she said there were questions around how the £350 payment would be taxed and how this might impact landlords, whether it would be included in affordability calculations or not, and how the scheme would operate under tenancy law.
She said it was unclear how it would interact with the Housing and Tenancy Act, and therefore was ambiguous as to how evictions may work if necessary.
She also noted: “I think people are thinking with their heart here so they may not think to notify their mortgage lender in the first place, they may not be aware that they have to which could create problems further down the line.”
Wesley Davidson, director at Fox Davidson, said the scheme had “noble intentions” but there were “challenges that needed to be addressed”.
He explained: “Properties that are mortgaged will have restrictions on allowing additional people to live in them. Mortgage lenders have specific rules with regard to lodgers, so will they waive any restrictive conditions?
“Where a property is mortgaged as a rental property, lenders typically only allow tenants who are on an Assured Shorthold Tenancy, which would not be the case here. Clearly there needs to be more input from the government and from mortgage lenders so that the scheme doesn’t cause any legal issues for homeowners with mortgages.”
He added that he expected demand to be high, and said the issues were “rather trivial given the hardship many are facing in the Ukraine”.
“Therefore, I would hope that the points mentioned above are addressed quickly so that all those offering homes can be matched with those in need,” he said.
However, Jane King, mortgage and equity release adviser at Ashridge Finance, said it would have “no effect on mortgage lending” and that the criteria needed would be very similar to taking in a lodger, which lenders already allow in certain instances.
She said: “They [lenders] do not object to a lodgers and the families would not be renting the property on a commercial basis. Rather they are being ‘hosted’ so the income from the scheme could not be used for affordability, unless lenders decide in the future to accept this, and so this arrangement would be fine.
“I cannot think of any pitfalls apart from those that would apply regardless of who they were bringing into their home such as potential criminal behaviour, squatting and so on but those scenarios are very rare.”
However, Chris Sykes, associate director and mortgage consultant at Private Finance, said that whilst most lenders would allow you to have a lodger with an informal or lodger agreement in place, this was usually for an individual rather than a family and was often “open ended to protect both the homeowner and bank”.
He added that as the Homes for Ukraine was generally aimed at families this could raise some questions for lenders.
Lewis Shaw, founder and mortgage expert at Shaw Financial Services: “Notable challenges will be around the legality of receiving income from the state for a lodger and how this affects your home insurance. Anyone with a mortgage or buildings and contents insurance should check that all providers are happy.
“Though I’m sure things will be fine, don’t make the assumption they will be. Check it and get it in writing to cover yourself in the event anything untoward happens.”
Buy-to-let landlords using the scheme could be ‘more complicated’
Brokers expressed concerns around buy-to-let landlords using the scheme, as it could unintentionally violate mortgage terms and conditions.
Sykes said: “If letting a buy-to-let on this basis it could be more complicated for sure. Especially when needing to remortgage as lenders often go off the lower of the received rental and the market rental for their affordability calculations.”
Shaw added that he was worried about “unscrupulous landlords” taking advantage of the Homes for Ukraine scheme. Bhudia agreed and said there needed to be a safety net in place so that refugees using the scheme were not exploited.
Matthew Rowne, director of The Buy to Let Broker, said: “It is vital that the government swiftly provides details as to how landlords can easily register properties that might be suitable for those who need homes.
“Landlords who have leveraged their portfolio will also need lender guidance to ensure that they are not falling foul of individual lender terms and conditions.”
Rowne added: “It is too early to obtain all lender’s perspective on this at this stage, however lenders and our industry have pulled together in terms of crisis historically, and with such tragic events happening right before our eyes, we should all be doing everything we can do to help those in most need, both as an industry and individually.”
Trade body and lender overview
UK Finance and the Building Societies Association (BSA) are currently working with the government on finalising scheme details, with aim of it “being implemented as quickly and simply as possible, enabling homeowners to participate easily”, according to a joint statement.
It continued that mortgage lenders were “supportive” of the scheme.
It added: “The immediate guidance for homeowners and landlords with a mortgage, who already have or wish to express their interest in joining the scheme, is to look at the government website and FAQs. It will be important for borrowers, once accepted onto the scheme, to let their lender know.”
Skipton Building Society announced earlier this week that it would support borrowers who wanted to sign up for the scheme and would offer its own vacant properties to refugee families.
Stacey Stothard, head of sustainability at Skipton BS, said the position was a “starting point” and it would “make it as easy as possible” for borrowers to sign up for the scheme. She added that it had not had any cases yet for new borrowers, but it had a lot of interest from existing borrowers.
She said for new customers interested in the scheme, they would assess how many adults would be in the property. She said more guidance was needed from the government on how the grant may or may not impact affordability and further clarity on what requirements there may be for buy-to-let landlords.
She added that due to its manual underwriting process, it could look at applications on a “case-by-case basis” and would aim to do so.
A Lloyds Banking Group spokesperson said it was supportive of the Homes for Ukraine scheme and urged mortgage customers to keep them informed if they were taking part.
They said there be no change to rates if residential customers choose to rent a room out under the scheme and assured it would be acceptable under its existing buy-to-let mortgage conditions for landlords.
A Nationwide spokesperson said it was aware many members would want to support refugees via the scheme and it would waive charges for residential mortgage borrowers deciding to rent out their property through the scheme.
The typical charge for permission to let would be a one per cent increase on usual rates and members typically would not be able to switch to a new deal, but this would not be the case if borrowers let out their property through the scheme.
A Nationwide spokesperson added: “We’re still working through some of the details, including for buy-to-let landlords, and will add more information to our website in due course.”
A Leeds Building Society spokesperson said it would support the scheme and was looking at turning an unused part of its branch estate into emergency accommodation.
“The details of how it will operate are still being confirmed but we can say we’ll not be imposing any additional charges or increased interest rates for borrowers taking part in Homes for Ukraine. There will be no changes to our affordability criteria and the assessments of new mortgage applications across all of our lending will remain the same,” the spokesperson added.
A Yorkshire Building Society spokesperson said it was “definitely interested” in assisting the scheme but there were “nuances and details” it was exploring and it was waiting on further information for the government, UK Finance and the BSA.
A Virgin Money spokesperson said the firm was “still looking at how we can support it”, and a HSBC spokesperson added that it was “actively assessing how best to support this important initiative” and further details would be made available in due course.
A Barclays spokesperson said: “We’re fully supportive of this new scheme and we’re working closely with the government as details are being finalised. We want to help make it as simple as possible for homeowners to take part. We’ll update our website as soon as we know more.”
This was echoed by Santander, who said it was “proud to support” the scheme and it would be providing further information to mortgage and home insurance customers in due course.
Natwest said that it was in favour of the scheme but was awaiting further detail, and TSB added it was “urgently exploring ways we can make it possible for our customers to support Ukrainian refugees”.
A Coventry BS spokesperson said: “We want it to be as easy as possible for people to participate and are united with other UK building societies and banks in making it a straightforward process or homeowners.”
It urged mortgage members who wanted to take part to visit the government website for more information.
Skipton BS’ 2021 gross mortgage lending rises 20 per cent to £5.4bn
In its financial results for the year ending 31 December 2021, the mutual’s mortgage balance went up by 6.8 per cent in 2021, a slight decrease on the 8.6 per cent growth in the prior year.
It provided 30,282 mortgages in 2021, and of that 7,893 were to first-time buyers. This is up from 24,557 mortgages it provided in 2020, as well as the 5,424 which went to first-time buyers.
It also completed 6,899 buy-to-let mortgages, an increase from 5,955 in the prior year.
Skipton’s mortgage portfolio came to £23bn and lending accounted for two per cent of the growth in the UK residential mortgage market, which compared to its 1.4 per cent share of UK residential mortgage balances.
Its profit before tax for its mortgage and savings division nearly tripled from £67.3m in 2020 to £165.3m in 2021. This was partially attributed to a credit of £13m from loan impairment provisions.
This compared to a profit before tax for the wider group of £271.7m, which is more than double the £118.8m figure from last year.
Residential mortgages in arrears of three months of more came to 0.22 per cent, which is below the industry average of 0.83 per cent and compares to 0.29 per cent last year.
David Cutter (pictured), Skipton Group’s chief executive, said the results were a “testament to the strength” of its business model, colleague engagement, strong culture and ability to move quickly to seize opportunities.
He also noted the growing economic confidence and strong housing market had played in its favour.
He said: “2021 was a remarkable year for Skipton as all of our people continued to support our customers at the moments that matter, regardless of what the ongoing pandemic threw at everyone.
“And while the UK adjusts to a post-pandemic future, with new social norms and consumer behaviours, our purpose remains the same – helping people have a home, save for their life ahead, and supporting their long-term financial wellbeing.”
‘Strong competition’ to remain in mortgage market
Skipton BS said it started 2022 from a “position of great strength” and plans to continue investing in its business and people to respond to changing market conditions.
The lender said it expected “strong competition” to remain in the mortgage market in the coming year as lenders still hold high levels of liquidity. It added that this would put more pressure on interest margins.
However, the mutual said it remaining alert to “increasing geopolitical uncertainty” from the conflict in Ukraine but it said its financial strength, diverse business portfolio and focus on customer and colleague experience would hold it in good stead.
It added that the housing market would likely “moderate” in 2022 and the mutual said it planned to do more to support first-time buyers.
Connells and Skipton International report strong performance
Skipton BS said that Connells, which is owned by the group, delivered dividends of £60m to the mutual and it has repaid £124.8m of the £253m which was loaned to Connells as part of its acquisition of Countrywide last year.
Connells’ profit before tax increased by £59.5m to £111.3m, and property exchanges were 175 per cent higher than the year before.
Buyer registration also increased by over a third, 38 per cent, on a like-for-like basis, although stock shortage remains an issue.
Skipton International, which is a Guernsey-based bank that specialises in expat mortgages, saw its mortgage balances come to £1.7bn in 2021, which is up from £1.6bn in the previous year. It reported profits before tax of £25.5m, up from £19.9m in 2020.
The report added that the quality of Skipton International’s mortgage book “remains good” with only one case in arrears by three months or more, which is the same as the previous year.
Lenders adjust variable rates following BoE decision
The 0.25 per cent hike was made at the Monetary Policy Committee meeting on 16 March and represented the third increase since December. This has also brought the base rate back to the level it was between August 2018 and March 2020.
In response, Nationwide’s tracker mortgage rates will be impacted from 1 May. This will not apply to trackers reserved between 1 December 2004 and 16 February 2009 as the tracker floor is higher than the base rate.
The mutual said it was “working through” what this might mean for its standard mortgage rate (SMR) and base mortgage rate (BMR) but assured it would provide an update in due course.
Santander said the rates of its tracker mortgages would automatically rise to reflect the new rate and will apply from the beginning of April. Its follow on rate will increase from 3.75 per cent to four per cent.
All tracker rates and reversionary rates on its new business and internal transfer products will increase in line with the base rate on Wednesday 23 March.
Alliance and Leicester’s tracker mortgages will also be increased at the beginning of May while its standard variable rate (SVR) has gone up from 4.74 per cent to 4.99 per cent.
Skipton Building Society confirmed existing borrowers on tracker mortgages would also see an increase to their rate and this will happen within two weeks.
Its current base tracker products will be withdrawn on 21 March and replaced the following day.
This will not be passed on through the mutual’s SVR or mortgage variable rate (MVR).
Ian Cornelius, Skipton’s commercial director, said: “With households facing the highest inflation rate for many years and customers facing soaring energy bills, it’s our duty to help our customers during these challenging times.
“That is why we have taken the decision to hold our MVR/SVR rates at current levels – we believe it’s the right thing to do for our borrowers.”
Halifax said it will write to affected borrowers notifying them of any changes to their interest rates.
The Co-operative Bank said it will review its tracker mortgage rates and SVR and communicate any updates to borrowers.
Skipton BS hires two BDMs to team
Charalambous joins the business from Mortgage Magic, which is a mortgage platform catered to brokers, networks and distributors. He was deputy director for nearly two years.
Prior to that he worked at Countrywide Mortgages for just over a year, and was a BDM at London Credit for around a year. He has also held roles at AH Consultants and Santander.
Duffy started in the intermediary sector in 2016 and was most recently a BDM for the North East at Coventry BS for nearly four years.
John Scrivens, regional sales manager at Skipton Building Society, said: “Andy and James join the team at an exciting time as we’re continuing to expand our team of BDMs to support the intermediary market, as well as furthering Skipton’s ambition to become a top 10 lender.”
Skipton BS allows borrowers to join Homes for Ukraine scheme and pledges support
The mutual said that it would “do everything it can” to support borrowers who wanted to be part of the scheme and it would offer vacant properties it owns to refugee families.
The Homes for Ukraine scheme will allow individuals, charities, community groups and businesses in the UK to host Ukrainian refugees, including those with no family ties to the UK.
In phase one of the scheme sponsors can nominate a named Ukrainian or a named Ukrainian family to stay with them in their home or in a separate property.
A webpage to register interest in the scheme was launched by the Department of Levelling Up, Housing and Communities yesterday.
Stacey Stothard (pictured), head of sustainability at Skipton Building Society, said that it was “watching on in absolute horror at the devastating humanitarian crisis in the Ukraine”.
She added: “We simply cannot imagine how traumatising it must be to flee your home against your will, with just the possessions that you can carry, leaving friends, neighbours and loved ones behind.
Stothard continued that the mutual wanted to “everything within our power to support refugees of this war”.
She continued: “As a mortgage lender we commit today to any of our customers wanting to offer space in their homes to refugees that we will do everything we can to make this happen irrespective of our lending criteria rules or the terms and conditions our customers signed when taking their Skipton mortgage. This is the right thing for us to do.”
The mutual pledged £50,000 to the Disasters Emergency Committee’s Ukraine Humanitarian Appeal last week and said that people could donate to the appeal via its branches or online.
Homes for Ukraine scheme commendable but legal pitfalls to consider
Christian Fox, a barrister at Becket Chambers and a property law specialist, said that the UK had seen an outpouring of support for Ukraine and there was likely to be high interest in the scheme.
He said: “Offering sanctuary to people in need is to be lauded and anyone considering opening their rooms, homes or properties should not be put off.”
However, he added that there were “legal pitfalls” that residents and hosts should consider.
He explained: “Offering anything other than a room in your own main home, for example an annex or separate property, can inadvertently create a tenancy. It is far better for both parties to understand the way they can extend or terminate the agreement now, rather than risking acrimony or legal action later.
“There are also questions around responsibility for property maintenance, insurance and payment for utilities and council tax that need to be considered before, rather than after, the event.”
He added that if an owner of a second home or investment property allowed several families to stay this may mean that the property would need to register as a House in Multiple Occupation (HMO).
“While we might hope that local authorities would be sympathetic, unless the government scheme allows exemption, then at the very least licensing will need to be investigated with the local council and their views sought,” Fox said.
He added that offering a room was not as complex as offering a property but offering a property on a long-term basis could impact property insurance or breach mortgage or lease terms. Fox said that many mortgage conditions or lease terms would preclude other families staying in the long-term.
Fox said: “There are also statutory overcrowding offences under the Housing Act 1985, and it is uncertain, for now at least, if these are waived by the Homes for Ukraine scheme or not. As a minimum, hosts would be well advised to contact their mortgage company or landlord and check their insurance cover.”