The association warns proposals for free loans for first-time buyers are concerning. It says the scheme will cause uncertainty within the industry relating to the regulatory risks involved in advising first-time buyers.
AMI Director General Chris Cummings says: “We would have liked to see this proposal opened up beyond the first-time buyer market as the biggest level of transaction within the mortgage industry is the remortgage market.
“Also, for the majority of first-time buyers, new build properties are not the answer. We would therefore like to see the government reconsider its proposals and allow a more liberal approach to the scheme.”
Cummings also fears that the scheme also only covers 30 per cent of the value of the property. It says it is essential that mortgage advisers fully understand lenders’ attitude to the remaining 70 per cent of the loan.
He says: “How will lenders view the 30 per cent security? And will first-time buyers need to lodge a deposit in addition to the 30 per cent advanced under the scheme?”
AMI also admitted more could have been done regarding stamp duty.
Cummings says: “The danger of offering such a solution limited to a one year period remains and risks creating an artificial bubble in house prices.
“We would like to see a root and branch reform of stamp duty, which considers its efficacy in today’s market and which draws on international comparators to assess its future role in public finance. The current regime looks dated.”
Also, in light of the proposals regarding struggling homeowners selling property to Government bodies, AMI says that it would particularly like to see the sale and rent back schemes under statutory regulation.