It has been coming for some time if you believe what the government has to say, but now the HSBC has promised to increase its lending for homeowners during 2009.

The figures promised relate to £15bn which is an increase of 20 per cent, this would clearly be a step in the right direction to get homes selling again. As we know it is not for the want of a mortgage that lending is down, it is the stricter conditions applied to mortgage lending that has all but stopped the mortgage market.

A promise to increase its mortgage lending suggests that some requirements will be reduced allowing more applications to accepted.  The Telegraph has the full mortgage story for you to read

There doesn’t seem to be any good news on the homeowner front these days, even though the Bank Of England interest rates are at an all time low and house prices have reduced considerably also.  This latest piece of news, released by the media last week including the Sunday Express, is now reporting a huge increase of repossessions even though there have been agreements by Gordon Brown and the banks to help homeowners get through these difficult times.

The period from July to September saw an increase of repossessions of 92% compared to the same time in 2007. Of course as many job cuts have been announced since then, there is a real worry that the next set of figures will be even worse. Even though some safety measures have been announced to help those who forfeit on their mortgage keep their homes, there have been comments that they are not enough to help many homeowners through this time.

Gordon Brown has also announced another rescue plan to get the banks lending to people and businesses once again. One of the measures to help the mortgage market was guarantees for mortgage backed securities. However this scheme will not start to April 4th the tax year.

For most home owners the current situation is becoming too complicated to understand, in a world where we were brought up to never spend beyond our means, we are now being told that the economy is struggling because no one is lending to anyone and the vast amount of tax payers money is being invested to stimulate the money lending market.

The confusion is increased as financial experts just don’t seem to want to agree and the “we will work together” attitude of the political parties seems to have diminished as conservative disagree with Labour’s policies and in fact has suggested he could bankrupt the country

The news quoted that never since gravity had been discovered had the Bank Of England base rate been so low as the recent reduction down to 1.5%. Of course they were refereeing to the fact the Bank Of England was set up the same year as Newton dropped his apple, and in this period of time, never has the rate been so low.

Of course the newsmen went out on to the streets to get the reaction form the public, just to be told that cheaper mortgages would not encourage them to spend more and in fact they would use any savings to reduce their debt, not spend more or increase it. Business owners were quoted as saying that the bank rate was OK anyway, the problem was getting banks to lend to them in the first place.

The media seems to be delivering two messages, one from those who are still ion a job and have not been effected by the credit crunch, they are still getting paid, prices in general are dropping, fuel is no longer as expensive it was and they are benefitting from cheaper mortgage, providing they already have one of course. We are often hearing the words “Credit Crunch What Credit crunch”? The second message is from those who either do not own a home or are looking for one, or those who have been made redundant recently. This is the group who are finding it hard through this hard financial time.

Take those first time buyers. House prices have dropped, good news for them and mortgage rates are now also dropping, and so many are at a point where they feel they can get on the mortgage ladder. The problem is of course, they now need a substantial deposit to secure a mortgage, with the worry that the house they will be buying may put any borrower into a negative equity situation. The next stumbling block is that many lenders will not longer take bonuses or even overtime into account as part of the borrowing calculation. Finally those who work within certain industries may find it harder than others. It is unlikely that anyone in the car business will be looked on favourably at the moment with factories either reducing the workforce or working weeks.

So will the Bank Of England Interest rate drop help the economy. Well if you believe the news, it probably will not. But lets be honest, were all opinions expressed on TV, or were selected interviewees aired only, to ensure an interesting news item?

This is for you to decide!!

There will be many in the Mortgage business and finance in general that will be thinking, “what a year that was and roll on 2009”. Last year for many would have been their worst in the business, with mortgage applications down, financial institutions being bailed out from governments right around the world, and share prices in banks taking the lowest in value.

Many local mortgage brokers and advisers, whose incomes are directly reliant on the acceptance of mortgage applications to the willingness for banks and building societies to lend out money, were hurt badly last year, with an estimated 50% of mortgage advisers needing to find a new profession, within the London area alone.

This morning there will be a hope from all those in the business who offer mortgage advice, that the future is brighter and the insistence that mortgage lenders start being less critical in their acceptance procedures and kick start the borrowing, by the Government will make a difference to all.

It is amazing how a new year can change the focus for negative to positive; even Mortgagebam is setting out into a market at its weakest time, with the resolution to not let others get in the way of own standards and commitments. Life still goes on, people still get married, people still get divorced and people still need a home to live in.

With home considerably cheaper and even the national press suggesting it is time to shop around for new mortgage deals as building societies reduce their rates, because of the bank of England rate cut, for many this could be the best time to buy a new home and get a mortgage deal in 18 months or so.

It is time for those independent mortgage advisers out there, to compare what is on the market now to 6 months ago and spread the news and of course explain the downfalls of a long term financial commitment, not that it needs much explaining at the moment. Anyway, wish you all a happy and prosperous 2009, both you in the industry of help and advise and those who read our blog.

All the best!
Mortgagebam

As I sit in a jet crossing the  Atlantic away on business, I thought I would use my free copy of the Times to research what is going on within mortgage buyers, even though theses are normally quieter times coming up to Christmas anyway. The first thing to notice is that house buying news is no longer front page news as the siege in India and the demise of Woolworths takes care of just about all the news, but well within the Times, I get to the business section and at last something about  house buying and I suppose Mortgage applications.

 

According to Grainne Gilmore, house sales have picked up recently but there still is downfall in prices to different degrees across the country. Octobers saw it bad again, with homes in Wales such as Merthyr Tydfill losing as much as 5.1% in value, although with an annual downturn of 6.9%, you wonder if this is a delayed action; when you compare it say to Blackpool which last month had a 3.9% reduction and a yearly loss of 12.6%.

 

The figures used were form the Land Registry which is seen more reliable from surveys done by Halifax or Nationwide as they measure real prices and not just mortgages approved. Even though there are signs of a pick up, they still are near the lowest levels recorded. There was a buck to the trend for house sellers in Anglesey where houses rose by 3.1.% last month. As a whole house prices dropped 1.5% in October.

 

“Help is available”, is the message as the USA administrationas it  looks to offer a mortgage rescue programme to help those home owners who are at risk of losing their homes. Although this programme could save many mortgage defaulters their home, there is no gaurantee it will help everyone.

The mortgage support could be in the form of reducing interest or extending the period of the mortgage to make it more affordable. It will be likely that mortgage brokers back here in the UK, will be waiting to see if this settles the USA market and then stimulates the home buying market back here in the UK.

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The dawn of Mortgagebam is nearly here with only a few additions and alterations to be made before we are live for real. There is still some text issues of which we need some more mortgage advisers to commit to their opinions and of course then comes the hard job of convincing the thousands of mortgage brokers to join Mortgagebam’s system.

There are lead generating sites already out there, but we believe we are different as in that we are set up more for the consumer who is looking for that mortgage, rather than very detailed forms to fill in that will keep the mortgage broker happy, but put any consumer off who does not like disclosing a lot of private information into a web form.

This may be the challenge when we go public and have to convince mortgage brokers why in the 21^st century we need to out the consumer first and it is the mortgage brokers responsibility to give their customers what they want.

We still also have to trial the ratings system to ensure it works correctly, not to mention a few issues with the automated email system. But we are sure that in a short period of time, we will be bring consumers together with mortgage brokers throughout the UK.

In order to sell any mortgage product in the UK, you must not only be qualified to do so, but also be registered with the financial services authority to do so.  So when the question of how do I know the mortgage adviser I want to have a face to face meeting with, is qualified is asked then the Financial Services Authority or FSA is the place to start.

In fact they have made it very simple for consumers to check on the validity of any mortgage broker, company or adviser advertising or selling services. All you need to ask for is their FSA reference number, which many mortgage brokers will clearly show on all stationary or website, then use the handy online tool provided by the FSA.

The tool is the FSA register which is locate here http://www.fsa.gov.uk/register/home.do and just by entering their reference number will show if they are registered with the FSA or not. You can type in the individuals name or business name, but it needs to be exact to what is stored in their database to show up, so it easier with the correct FSA reference number.

Al mortgage brokers who subscribe to Mortgagebam are asked to provide their FSA registration number, which we in turn will check against this register.