News & Views

Mortgage lending rises in May

Gross mortgage lending rose by 12% from April to May, according to the Council of Mortgage Lenders. Gross lending totaled £10.1bn in April but reached £11.3bn in May. The figure represents a 1% increase on May 2010. Gross lending in April had fallen by 14% on March with the Easter bank holidays and the Royal Wedding blamed for the lull in activity.

Average age of a first-time buyer could hit 44

The average age of a first-time buyer could hit 44 as would-be homeowners struggle to get the money together to get a deposit. Scottish Widows reports potential buyers could be unable to start making serious savings towards a deposit until they reach their thirties meaning they are unlikely to make it onto the property ladder until they reach their mid-forties. The average age of a first-time buyer is currently 30 but Scottish Widows predicts this is set to change. It says consumers are too busy paying off credit card debt and repaying loans to focus on saving for a house.

Interview with Nigel Alexander

With transparency the order of the day we chat to Nigel Alexander, Director at Fincorp to find out why straightforward, clear-cut lending is important to Fincorp, what it means for brokers and consumers and why 'clear and simple' is the company's mantra.
How important is transparency to Fincorp?

Very, we've been in the business over 20 years. We take the view that a reputation takes a long time to build up and can be ruined in a second. We're very motivated by that and treating customers fairly. We like to keep everything above board in a sector that hasn't always enjoyed the best reputation.
Why is it so important to the consumer?

It's important for them to see what they're getting themselves into. People can be seduced by a headline rate. One lender may only charge a rate of 0.9% while others in the market charge 1.5% but there's a 3% of fees hidden in the small print. We don't have any small print. What you see is what you get with us. We're perfectly upfront about it. We tell people exactly how much it will cost from day one. If they're seduced by a lower rate we encourage them to look at the overall costs rather than just the headline rate.
How does it help brokers?

It's an easier product for them to sell. If they like us, and they like what we say, they can go back to the customer and say 'Here you are, this is what you'll pay. There are no extra costs. There's no fees in the transaction'. You pay a single rate and that's it. It's easy for them to explain to the clients.
Why are some lenders not as transparent?

I don't think it's a lack of transparency, I think it's how they present themselves. Everyone in this market has a way of presenting themselves and we're just different because we don't have any fees. It's indicative of how we do business; it's straightforward for the customer and the broker. Our mantra is 'clear and simple'. People ring up and, initially, find it hard to believe we don't charge any fees.
Do you think documentation for loans should be clear in terms of fees?

It's in the terms and conditions so lenders who charge fees would say it is. That's fair enough. Loans are a huge commitment; it's like taking on a mortgage. I don't suppose everyone reads the conditions on the back of a mortgage document but they do read the headline terms.
Finally, why do you not charge fees? How do you manage?

We have our rate, that's how we are remunerated. We don't seduce people with our headline rate. We get brokers or clients ringing up saying they can get a better rate elsewhere and we tell them, before they do, to check if there are any fees. When they do, they often find we are extremely competitive. In the consumer market consumers expect to be stung with a fee. Often it's in the small print, but our print is all the same size. We don't have anything to hide.