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This week in Mortgages

Last week saw the spotlight fall on GE Money Home Lending over alleged undisclosed commission from past and present subsidiaries that is likely to result in compensation claims later this year from disgruntled mortgage customers.

Of course, these are only claims and will be vigorously fought by the lender, but the issue brings into sharp focus that claims firms are now likely to pursue the mortgage market over past issues.

The claim management firm at the centre of the controversy Loancheck, which was set up three years ago but is finally set to become fully operational next month after securing funding. It says that any misdemeanors it has on its books are not current ones but legacy ones. It says these were largely prevalent before M-Day.

Perhaps that is a sign that if there are genuine reasons for claims then those problems have largely been resolved as the market has made great efforts to clean its reputation spurred by regulation and aided by campaigns such as that from Pink Home Loans.

It appears that Loancheck will not chase brokers and instead focus on claims against lenders, even though brokers’ have been accused by the claim firm of being less than honourable. It would be wise for brokers that have indulged in any suspect practices to clean up their act. While that issue will run and run, an interesting comparison was made by Pink’s MD Tony Jones who likened the UK’s largest mortgage lender HBOS to the Premiership’s top team over the past two years Chelsea (and that was a very difficult statement to make coming from an Arsenal fan).

Jones reckons HBOS’ dominance and financial muscle is similar to that of the west London football club, with its ability to launch suites of extremely cheap products and to lure almost any new customer in a similar style to Chelsea using owner Russian Roman Abramovich’s billions to lure almost any player he wants to Stamford Bridge.

Abbey and Northern Rock were tipped by Hamptons to be the two most likely to challenge HBOS’s dominance with Abbey later likening itself to Liverpool, what with its Spanish influence in owner Banco Santander akin to Liverpool boss Rafael Benitez hailing from Spain.

In fact, Abbey’s press officer Joe Wiggins exact words were: ‘We are like Liverpool with our Spanish backbone, English grit in the middle and a squirrel at the back.’ That, of course, was a reference to the use of a red squirrel in many of Abbey’s savings adverts after it replaced the grey squirrel used in past ads after campaigners for the under-threat red native species complained.

If Northern Rock is the closest challenger to HBOS then it is certainly not the Newcastle – the team it sponsors and perennial underachievers – of the mortgage market. One HBOS insider joked that its intermediary boss Nigel Stockton would never get his way of comparing his company to his favourite football team, Coventry City, as its recent fortunes make it the Hips of the football world.


This week in Investment

With less than a month to go until the big split. Fidelity eyes will be closely watching the special situations fund for signs of outflows. From a peak of 6.5bn a few months ago, money appears to be trickling out and this week the fund dipped under 6bn.

Alliance & Leicester – Premier Mortgage Services Exclusive Prime Self-Cert Two Year Fixed Rate

Alliance & LeicesterPremier Mortgage Services Exclusive Prime Self-Cert Two Year Fixed RateType: Self-cert fixed rateFixed term: Until September 30, 2008Fixed rate: 4.9%Minimum loan: £26,000Maximum loan: Up to 85% of valuation subject to a maximum of £300,000Income multiples: Based on affordabilityArrangement fee: £1,999Conditions: Free valuation, £250 cashbackRedemption fee: 6% of mortgage balance in year one, 5% […]

LivVic offers Red Arc care services to all CI policyholders

Liverpool Victoria is to be the first provider to offer Red Arc’s care advisory services to both new and existing critical-illness policyholders. Red Arc’s Extra Care services will be available from September 1 to policyholders free of charge on payment of the claim. Red Arc offers counselling services to policyholders, including a personal nurse adviser […]

Greater collaboration

Collaborative law could see more solicitors turning to advisers for help on how best to split pension rights on divorce

Mothers missing out on millions

By Steve Webb, director of policy and external communications The ninth Royal London Policy Paper discusses how thousands of mothers are missing out on state pension rights when they don’t have to Earlier this month we published the ninth Royal London Policy Paper, entitled ‘Mothers Missing out on Millions’. It focuses on the thousands of mothers […]


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