Brokers complain over lack of access to mortgage deals
Whilst the global cr4edit crunch has hit all sectors of the mortgage industry extremely hard over recent months the news has been dominated by stories about how lenders and consumers have really suffered as a result of the effects of the credit squeeze. Lenders have found it increasingly hard to get finance for their mortgage lending operations, and therefore have had to tighten credit conditions, increase the cost of borrowing, and remove various mortgage products from the shelves. This has, of course, impacted on consumers, who have found it increasingly difficult to get an affordable mortgage due to lack of accessibility, availability, and affordability.
However, there is also another industry group that has suffered as a result of the global credit crunch, and this is mortgage intermediaries such as brokers. In the past well over half of mortgage deals have been generated through brokers, but lenders are now cutting back on the deals that they offer through brokers, and are instead trying to entice customers to apply directly through the lender by offering exclusive deals that are not available through brokers or by lowering the rate on deals for direct applicants.
This move has caused concern for mortgage intermediaries and the Association of Mortgage Intermediaries has filed a complaint with the Financial Services Authority over the matter. However, official from the FSA state that the fact that lenders are offering some deals directly is not necessarily bad news for the consumer. The FSA said: “It is a commercial decision for a lender whether they want to offer products directly to the public or via a broker. Anyone dealing with consumers should ensure that consumers are treated fairly.”
Recent additions:
- Slump in lending levels fuelled by credit crunch
- Struggle continues for first time buyers
- Many lenders ignore base rate cuts
- Mortgage approvals slumped in March
- Credit crunch means slump in mortgage lending
Related Posts
Should brokers have access to all mortgage deals?
One of the traditional ways of finding a suitable mortgage for many people in the UK over recent years has been to go through a broker. Many people who were keen to find the most competitive deal tended to avoid gong from one lender to another in order to browse and compare deals, and get a broker to do the legwork for them, which often saved them time and money. However, in the dark days of the global credit crunch there are many consumers that may find themselves missing out if they go through a broker, and this is something that the mortgage broker industry is not happy about.»
The importance of seeking mortgage advice
Anyone that is not now aware of the chaos that has engulfed the mortgage lending sector in the UK must have been asleep for the past six months. Since the onset of the global credit crunch last summer the UK’s mortgage lending sector has gone from bad to worse, with the effects of the global credit crunch having a profound effect on mortgage lending throughout the nation.»
Rise in number of dodgy mortgage brokers
Over the past three years there has been a marked rise in the number of mortgage brokers under the watchful eye of the UK’s financial regulator, the Financial Services Authority, with a rising number of brokers being fined for malpractice and mis-selling. The FSA has been cracking down particularly hard over the past year as a result of the chaos and turbulence that has gripped the financial, mortgage, and housing sectors since the onset of the global credit crunch.»
5% deposit mortgages difficult to find
A recent report has indicated that the traditional 95% mortgage, with just a 5% deposit from the borrower, is becoming increasingly difficult to find. Until the onset of the credit crunch borrowers could easily get 95% mortgages, 100% mortgages, and even 125% mortgages, but over the past year all of this has changed. The 125% mortgage was the first to disappear as a result of the conditions stemming from the global credit crunch, and this was quickly followed by the 100% mortgage.»
Estate agents at risk of problems due to mortgage and housing chaos
A recent report has shown that many estate agents could be at risk of going bust as a result of problems in the housing and mortgage markets, which are resulting in fewer homes being sold through estate agents. The housing slump has resulted in fewer people taking the plunge when it comes to buying property, with many waiting for property prices to fall further, as they are expected to do. Sellers are also holding off putting homes up for sale in some cases, because they don’t want to sell at low prices.»
[...] Brokers complain over lack of access to mortgage deals [...]