Sunday, Nov 30, 2008
Looks like mortgage lending "debrief" is unravelling
Telegraph: Nationwide ditches standard variable rate for new borrowers
"Ray Boulger at John Charcol, the mortgage broker, said: "Less than a month after the breakfast meeting rolling out the Brown/Darling master plan to intimidate the major lenders into passing on the full 1.5 percentage point rate cut in their standard variable rate (SVR), the one with the lowest SVR and by far the largest proportion of its lending on SVR pulls the plug for all new lending on that rate.
"Not only did the master plan not last for life, it didn't even last until Christmas."
So, after Darling Browns finger wagging and stwong words, the first and one of the biggest lenders dares to make a business decision. With the VAT plans and now the lending tuff-talk both looking as robust as my kids strawberry fool, who is going to blink next?
5 Comments
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1. gardeniadotnet said...
"...the Brown/Darling master plan to intimidate the major lenders"
Ray Boulger using p4ac -type inflammatory language?
Ominous.
2. titaniccaptain said...
Unless the banks are nationalised it looks like it will be cash only for houses........................
@Gardeniadotnet
I await the day when the prime minister's speaches are followed by dots>. ........................... and have really bad spelling..........it will be at that point you will all know that it is I who is really in control of the world Mwa ha ha ha ha ha ha
3. stillthinking said...
Price controls don't work, and the BoE doesn't set the global borrowing rate.
We all want bread at 1p a loaf, but who will be the baker? Nice in a way, to see the cack-handed government worsen the house price crash, but I wish they wouldn't trample quite so heavily on my employment prospects....
4. plato said...
Government must know that slashing IRs would effectively wipe out SVRs. By setting their own base mortgage rates the banks remain in control in the housing market. The housing market is a lost cause,beyond rescue and only going in one direction and the banks cannot afford to lose any more or give great deals to such a market.
In the wider picture it's business that needs stimulating with low interest rates and good cash flow,especially small business where VAT should be minimised and the threshold raised substantially so that these businesses can start progressing,profit,invest and employ workers. Then everyone prospers.
5. gardeniadotnet said...
@4. plato said... In the wider picture it's business that needs stimulating
Yes, but the success of a business ultimately depends on the retail consumer, whose disposable income is diminishing rapidly.