View more on these topics

FSA warns mortgage intermediaries that profitability may drop

The FSA is warning that mortgage intermediaries and packagers could face pressures on profitability due to declining business volumes.

The regulator’s 2008 Financial Risk Outlook states that mortgage intermediaries will be particularly at risk if a combination of pressure on house prices, tighter credit conditions, lower consumer confidence and high levels of personal debt cause a decline in the demand and supply of mortgages in 2008.

It says that due to a “significantly less benign” economic environment, a large minority of consumers could experience financial problems due to high levels of borrowing.

It says: “We are concerned that many consumers are ill-prepared for a deterioration in economic conditions and may have placed too much reliance on their ability to depend on cheap credit and housing wealth to sustain their consumption levels and investment plans.”

The outlook estimates that repayments for consumers coming off fixed rate mortgages in the next year will rise by £210 per month and says this will have a serious impact on the affordability of loans.

The FRO says: “As economic conditions deteriorate, we are likely to see an even greater increase in repossessions.”

FSA chairman Callum McCarthy says these are not firm predictions but are a prudent attempt to highlight the risks that could impact consumers and firms in a less benign economy.

He says: “Firms and consumers need to recognise there are both short and long term risks and should think about the implications.”


Annuity deal for smokers

Partnership is offering what is claims to be the most competitive smoker annuity available .The product offers people over 50 who have smoked at least 10 cigarettes a day for the past ten years a guaranteed income higher than a standard annuity. It is only available through IFAs, who can get quotes from The Exchange’s […]

Funnell defends fund fee

GLG, the outsourced manager of Virgin Money’s new climate change fund, has responded to adviser criticism of the product by claiming it is a progressive step in the market.Advisers have questioned the fund’s green credentials and the 20 per cent performance fee for beating bank base rate.Fund manager Ben Funnell says the fund focuses on […]

Rent rises boost buy-to-let returns

Total returns for buy-to-let investors trebled to 21 per cent last year, says Paragon.The BTL lender’s January index shows that rental incomes rose by 2.5 per cent in December, bringing the annualised rate of growth to 19.4 per cent.Tenants are paying on average £965 a month for rented properties compared with £808 a year ago. […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm