Friday, Feb 15, 2008
Mortgage Risk Repricing Continues
The Times: Halifax 'rations' mortgages
'The move is seen as part of a wider trend of "leap-frogging" among lenders, who are competing to avoid business rather than to bring in new customers. Ray Boulger, of John Charcol, another broker, said: "Lenders like Halifax are effectively rationing loans. They are generating the amount of business they want and then rejecting it when they can no longer cope with demand. Lenders are leap-frogging each other to the bottom of the best-buy tables. They are no longer competing for business, they are competing to avoid it."'
Posted by quiet guy @ 06:40 AM (447 views) Add Comment
3 Comments
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1. hpwatcher said...
Far too little, far to late.
I expect the next few years will see more losses and also numerous mergers.
2. Duncan said...
Any real finance experts out there.
Despite reading up on it I'm still not sure what the BOE base rate means.
I'm pretty sure that it doesn't mean Halifax can borrow (long term) from the BOE at that rate.
Therefore it is meaningless. If Halifax can't get funding at that rate it can't lend at it (unless
it follows the Northern Rock business model). I have a regular saver account with them paying 7%
which is much higher than the base rate.
:- Duncan
p.s I can remember seeing a program a couple of years ago on Self Certification (now called Sub Prime)
mortgages. They interviewed a retired Building Society manager. He said that in the 1970s his branch
only got enough money to give out four mortgages a week. This gave him a whole day to check out each
persons circumstances before giving them a mortgage ! Recently it was 5 minutes by a call centre operator
in India.
3. inbreda said...
All part of the unavoidable downward spiral