View more on these topics

The sharp end of self-cert

So Panorama strikes again, hitting out at what it claims is the slovenly or dishonest way in which self-cert is used to push through inappropriate loans.

The figures certainly make for an interesting debate. Panorama says that self-cert combined with fast track could be as much as 30 per cent of the mortgage market.

The FSA says the figure is 6 per cent while the MCCB concurs with suggestions that the programme represented a storm in a teacup, as do most providers.

So there you have it – shoddy television journalism strikes again.

But just when everyone thought it was safe to get their customers estimating their substantial incomes once again, the chief executive of Yorkshire Building Society Iain Cornish wades in to the argument to say that self-cert risks becoming the next misselling scandal. Maybe Panorama was barking up the right tree after all.

Clearly, the first programme, in particular, revealed that some brokers were pushing things too far and were in breach of the mortgage code. Now senior industry figures are very concerned. And the FSA&#39s response is intriguing. It points out that repossessions for the self-cert sector run roughly in line with the rest of the mortgage market.

A telling point in a stable market but is this a stable market? Surely, there is a potential risk, given the lack of affordability. At the very least, the self-cert temptation exists and those who want to inflate their incomes may be tempted to shop around to find a broker who will break the rules.

Panorama proved that, in some cases, sharp practice exists. The extent of the problem is up for debate but perhaps the FSA and the MCCB should suggest what level of sharp practice that they are prepared to tolerate.


GMAC-RFC launches 25 year mortgage

GMAC-RFC has launched a customised 25 year mortgage. Borrowers are able to choose between a fixed rate of 5.95 per cent, a variable rate that tracks the base rate plus 0.75 per cent, or combinations of the two. The fixed rate is available at up to 5 times income, and the tracker has no redemption […]

Investment chief Hale quits Skandia

Skandia Investment Management chief investment officer Clive Hale has resigned from the company, saying he wants to spend more time with his family. He is being replaced by Hargreaves Lansdown investment director Alan Durrant, who will join SIM once the FSA has approved his appointment. Hale&#39s regulatory responsibilities will be taken on immediately by group […]

Sofa wants specially qualified with-profits advisers

Sofa has called on the FSA and the Financial Services Skills Council to make it compulsory for advisers to get specialised qualifications before they can advise on with-profits. In his response to the FSA consultation into with-profits reforms, outgoing Sofa managing director Brian Lawless says if the FSA wants “transparency of with-profits” for the consumer, […]

Letwin paves a path between taxation and public services

Oliver Letwin has unveiled key elements of his economic strategy designed to put the brakes on overall public spending while ensuring that more cash is pumped into health and education. And while the Shadow Chancellor aims to reduce the share of national wealth spent by Government – by slashing back on bureaucracy and curbing the […]

Auto enrolment – so far so good?

Jamie Clark – Business Development Manager The recent report from the Pensions Policy Institute demonstrates the sheer scale of auto-enrolment so far and what we can expect in the future. We’ve pulled out the key information to save you reading the full report. Auto enrolment in numbers Sources: Pensions Policy Institute, The Future Book: Unravelling […]


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