I have been reading with interest the announcement from Facebook of their impending floatation and the figures that have subsequently been released. Not bad making a profit of $1 billion in its 8th year of existence.
Following on from one of my main themes, one of Mark Zuckerbergs’ quotes struck a particular chord, “a more open world will also encourage businesses to engage with their customers directly and authentically.”
In our own financial world, Swaps have fallen again this week whilst LIBOR has eased off a touch which will hopefully mean that lenders will indulge in some rate cutting with no notice next week! I know, wishful thinking.
Three-month LIBOR is down at 1.08%.
1-year money is down 0.03% at 0.975%
2-year money is down 0.03% at 1.23%
3-year money is down 0.05% at 1.27%
5-year money is down 0.08% at 1.525%
I have had a few people contact me wanting to raise the issue around bridging loans. It seems more brokers are seeing customers who have taken out a bridge with no exit strategy or miss-used as a way of obtaining a property without going through the usual due-diligence. This really has to stop and I would urge everyone to only deal with the professional bridging companies and report any incidences of miss-use.
Bridging loans are a very useful and important sector of the market if advised on correctly and the last thing our industry needs is to be lumped in with the cowboys that miss-sell these products.
Whilst we have seen another week of product withdrawals and rate rises with various states of notice, (Nationwide caused the most panic, naughty and unusual from them), there is still much to be cheerful of.
In particular we have seen a couple more lenders coming into the 95% LTV space, mainly supported by Building Societies. There are around a dozen products at this level now and recent additions include a decent product from Newcastle Building Society fixed for 2 years at 5.95%.
On the subject of smaller lenders I feel I should mention in particular Kent Reliance, Saffron, Harpenden and Furness, all of which are worth taking the time to look at as they are doing some good old-fashioned deals, i.e. human underwriting, in a sensible and timely manner.
Rate wise Furness have just released a good 3 year discount at 3.29% with no fees and penalties only within the first 2 years up to 80% LTV.
One thing that is always important to brokers is levels of service from lenders so please let me know your experiences here we will identify some lenders that are good to use if you need a particularly speedy transaction. Last week Abbey produced a remortgage offer in a day, whilst an HSBC Premier customer was told he couldn’t even speak to someone properly about a mortgage for 2 weeks! Which was of course music to my ears.
There is another Zuckerberg quote I’ll end with, “We have a saying: “Move fast and break things.”… We have another saying: “The riskiest thing is to take no risks.”
We are of course not all Facebook, but I believe this year is the time for us as an industry to move forward, try new things and embrace change.
Paul Howard. There are many people in the industry I like and respect, but Paul is without doubt a special person. It is a shame he is leaving Nationwide but he is still in the industry and has a great deal to offer. Over the years he has always been available with some great advice, refreshing honesty and is a true gentleman.
Bridging companies that allow these expensive loans to be taken out without proper due diligence. It is another accident waiting to happen and must be stamped out.