The way mortgage lenders compete for new business results in cross-subsidisation from existing borrowers paying standard variable rates to new borrowers taking out discounted variable and short- term fixed rate mortgages according to Miles' findings. He says this practice means that longer-term fixed -rate mortgages appear expensive when compared with discounted mortgages.
You can see why the Chancellor would like everybody to have a US-style penalty-free long-term fixed-rate mortgage. If base rate increases, there is no impact on borrowers. But if base rate is reduced, borrowers could redeem and take advantage of extra spending power. So why aren't these products the norm? The truth is consumers prefer […]
The FSA has issued new guidelines for the fair treatment of with profits policyholders. The proposals include publishing target ranges for payouts and MVRs only applied if there has been either a significant change in the value of the fund's assets or if a high volume of surrenders has occurred or is expected. It also […]
Legislative and accounting constraints on building societies may require “a policy response” in order for the market for longer-term fixed rate mortgages to develop, according the Treasury. Responding to the interim report of the Miles review of the UK mortgage market, the Treasury says policy may need to be changed to help societies overcome capital […]
Lifeboat Financial Advisers has appointed Roy Wicks as a regional development director, covering the Midlands region.
By Kunal Desai, head of Indian equities, Neptune Since the election of Narendra Modi as prime minister in May 2014, Indian equities have gone on to outperform both developed and emerging markets. A busy period of governmental and economic reforms, a lower oil price and falling political risk have been the primary drivers over this […]
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A High Court judge says the FCA can submit evidence in a case that could shape how Sipp misselling claims are handled in the future. In the case, which started today, lorry driver Russell Adams alleges Carey Pensions missold him a self-invested personal pension. Carey Pensions is accused of using unregulated introducers to invest Adams’s […]
Studies have found funds can be too big or too small to outperform, suggesting size does matter The assessment of whether to invest in a certain fund is a tricky business. Bearing in mind roughly 90 per cent of active funds do not beat their benchmarks over periods longer than 10 years, the odds are […]
The following sorry verse embodies procrastination on a whole new level: “Hello there, my name’s Phil; I rap like a small bear writing a will [diligently]; Estate-planning, ninja-whooping IHT; Shame I’m not as bizzie [urban affectation] with the RLP.” These words were penned in response to my father’s short verse sent to me, after the […]