With all the claims and counter claims circulating about the turmoil within the finance markets it is difficult to establish what is really going on.
Naturally the main authority figures within the finance industry are at pains to point out that the economy is strong and that the lending institutions within the UK are all strong. Well one would hope so given that the high-street banks in this country have been making staggering profits over the last 3 years.
We’ve taken the liberty of listing some of the headlines from the finance industry press over October and November:
| Headline | Meaning? |
Advantage pulls products amid sector fears |
Advantage withdrew their heavy adverse range and added some restrictions to their medium adverse range. Their flagship prime products were unaffected. |
Nine providers hike loan rates |
Unsecured loan rates have increased. 4 months ago it was possible to get a sub 6% rate, now 6.9% is considered market leading. |
GMAC to close HSHL after 200 strong cull |
GMAC closes High Street Home Loans – Citing a desire to focus on their core business, and a shrinking adverse market. |
Black & White Group cuts quarter of workforce |
Black and White are a Rugeley based broker who have done very well in the self-cert and adverse home loan areas, they also have a strong background in Commercial mortgages. Intermediaries like these are considered most a risk from any “credit crunch” |
Rejected applications rise by over half |
In the past six months, MoneyExpert.com figures showed that the number of rejected applications has risen from 463,000 to a shocking 738,000 |
Lending volumes set to plummet |
Hometrack have predicted that net mortgage lending will be cut by almost 20% in 2008 |
Obviously this is just a selection of headlines from the trade press (Mortgage Introducer and Mortgage Intelligence). There are plenty of counter headlines demonstrating the confusion within the market.
If there was one conclusion that you could draw from these headlines is that mortgage lenders would not be cutting jobs if they were confident that lending levels were going to increase!