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This week in Mortgages

It seems that Latin is all the rage in the mortgage market at present. First there was Edeus’ launch in September, which showed that its boss Michael Bolton had clearly remembered his ‘amo, amas, amat’ from his GCSEs at school when he named his new lender ‘from God’ or ‘creator’, depending on which Latin dictionary you swear by.

Now we have Concordia – which is Latin for harmony – as the name for the high net worth broker alliance launched last Wednesday.

In a week of three huge stories that dominated the mortgage market, the collaboration of Alexander Hall, Chase de Vere Mortgage Management, Cobalt Capital, Hamptons International Mortgages and Savills Private Finance is arguably the one that has got most people in the industry talking as there have been very few broker initiatives of this magnitude over the past few years.

It has also created differing opinions as to its potential success and its subsequent effect on others in the market.

The most notable absentee is John Charcol, which was not approached to form part of the group, and it has hardly welcomed Concordia with open arms insisting it already enjoys the terms that the quintet are striving for in terms of product, service and remuneration from lenders so does not need to be a part.

Others, however, point to Concordia as being a natural fit as the five can use their volume to not only negotiate better terms but makes lenders’ lives simpler by only having to deal with one account.

One lender that has not had a simple past few days is Nationwide. Its decision to end its policy of offering exactly the same deals to new and existing customers has drawn a huge swathe of criticism. This is particularly so as the building society has always taken the moral high ground, most noticeably in its ‘new customers only’ advertising campaign, with its “same deal for all” stance.

It is not a happy with headlines of ‘U-turns’ and voices speaking out against ‘broken promises’ but the higher you position yourself the harder you fall when the pedestal comes crashing down. Its argument against the negative headlines is that is it still offering the same deals to all as long as customers fall within a certain product range, ie the homebuyer or remortgage range.

London and Country says the decision is therefore not a complete U-turn, so maybe Nationwide would rather the headline ‘L-turn’ or ‘J-Turn’?

The other significant piece of news was the regulator’s announcement that over 200 sub-prime brokers have been ordered to remove non-compliant advertising, with arguably the more shocking revelation that many borrowers are being sold adverse products when there is no sign of any impaired credit.

This comes as no surprise to those that have been calling for the cowboys to be booted out of the industry, but the scale of the problem seems particularly worrying and will tarnish the good reputation of the majority of brokers that are decent and honest.

Which of the three stories is most significant is a subjective matter but it is clear that all three have meant that the run-up to Christmas, in what is usually a quiet time for the market, will be filled with gossip and banter.


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