All Latest News

Too many consumers are opting for a lump sum when using equity release instead of drawing it down over time, claims industry expert.

Dean Mirfin, Group Director of Key Retirement Solutions, believes equity release advisers are not doing enough to inform clients about the benefits of drawdown.

Speaking at the Equity Release Market Monitor survey last week, Mirfin questioned adviser’s approach given the advantages of drawdown, despite it already accounting for 55 per cent of the market:

“Customers using drawdown benefit from lower borrowing costs because they are able to draw funds when required. There is still work to be done to ensure they are not taking out single advance equity release when they do not have a requirement for funds all at once.”¹

However Mirfin’s opinion is not shared by fellow industry authority, Vanessa Owen. The Head of Equity Release at LV= claims to have experienced little evidence supporting Mirfin’s push for drawdown, especially in the current climate:

“Often when people get the money in one lump sum it is for something such as a house purchase or to pay off existing debts, so it is logical that they are withdrawing the money in this way.”¹

Richard Espley, Head of Equity Release at Goldsmith Williams, see both sides of the argument but emphasises the needs of the client must be at the heart of all advice around equity release:

“We are all aware of the current financial climate’s impact on the equity release market and the varying need for this product; helping children or grandchildren with a deposit for their first house a prime example of where a lump sum is far more suitable than drawdown.

“It is responsibility of the equity release adviser to establish the basis of why the client wishes to release equity from their property and then recommend which direction is most appropriate and in their clients’ best interest.”

¹Mortgage Strategy (Jan 2011)

The personal injury industry is currently receiving a lot of air time, possibly the most it ever has. Many areas of the industry are coming under fire, most notably whiplash claims and their impact on the rising cost of motor insurance.

Between 2000 and 2005, there were on average 395,735 motor insurance injury claims notified to the Compensation Recovery Unit each year; in 2010 – 2011 there were 790,999. This is despite a 31 per cent decrease in the number of casualties between 2000 and 2010¹.

Whiplash accounts for around 70 per cent of all road traffic accident claims. Given the difficult nature in diagnosing this type of injury, it has become the easy target of blame with critics citing it as the main reason for the rise in premiums.

Jack Straw MP described whiplash as “not so much as injury, more a profitable invention of the human imagination – undiagnosable except by third-rate doctors in the pay of the claims management companies or personal injury lawyers”¹. Such opinions are strengthening calls for an industry shake up with Mr Straw proposing compensation for whiplash only be paid out when “clear objective evidence of real injury” is provided.

Whilst Goldsmith Williams is obviously firmly against any fraudulent claim, it is vital these reforms do not squash genuine claimants.

For many years, claimants of personal injury have been tarred with a particularly negative brush. While there is undeniably a select number of claimants who exploit the personal injury market, and who need to be brought to justice, there are an overwhelming majority of genuine claimants who too deserve access to justice, a viewpoint which is supported by the Association of Personal Injury Lawyers (APIL).

Following the report by the House of Commons Transport Committee, APIL criticised any measures that could hinder genuinely injured people from making valid claims.

It is responsibility of all parties – from brokers to personal injury solicitors – to help clean up the industry whilst continuing to act in the customers best interests. However, there is only so much we can do from our side; the insurance industry also has a vital role to play in the current situation as Simon Cottrell, senior partner at Goldsmith Williams, points out:

“Clearly, there are problems within the industry and I welcome the fact the Government is looking into it, but the Transport Committee’s report raises a key question.

“There is a deafening silence as to how much the insurance industry would be prepared to reduce premiums by if the Government were to uphold some or all of the recommendations put forward.

“The sector is claiming that premiums have risen as a result of whiplash injuries and fraudulent claims, but the reality is that the cost of insurance has rocketed as a consequence of many factors. Premiums have increased due to the need for insurance companies to make profits in a depressed market.

“The industry is continuing to peddle the illusion that whiplash claims is the only root of spiralling premiums which is absurd. Whiplash injuries are soft tissue injury and there is no absolute way to diagnose the severity of it. It is offensive of Jack Straw to say that they are assessed by third rate doctors.”

¹House of Commons Transport Committee: Cost of motor insurance: follow up (Jan 2012)

Virgin Money is aiming to double the value of mortgage lending at Northern Rock, with plans to advance around £45bn over the next five years.

In 2010, Northern Rock’s gross lending figures reached £4.2bn and 2011 is estimated at around £5bn.

While the lender is unable to confirm how it plans to distribute the money and what percentage will be made available to brokers, it has made several promises to this market stream including no dual pricing, something industry experts are labelling as “good news”.

More good news is the recent figures from the Council of Mortgage Lenders (CML) which reported a 12 per cent year-on-year increase for gross mortgage lending in December despite a month-on-month decrease. Gross lending totalled £37.3bn for Q4 2011, a drop of £2.1bn against the previous quarter yet an 11 per cent increase compared to the same period in 2010.

Bob Pannell, Chief Economist for the CML, is encouraged but remains realistic:

“There is a glimmer of light ahead for households in that real incomes could stabilise perhaps even start rising by the end of the year.

“But eurozone problems mean mortgage funding prospects are uncertain, so overall UK mortgage market conditions for the year ahead remain difficult to call.”¹

¹Mortgage Strategy (Jan 2011)

Irwin Mitchell has announced Glyn Barker, former Vice-Chairman at PricewaterhouseCoopers, as its’ Executive Chairman as the firm pushes on with its plans for alternative business structure (ABS) accreditation.

Barker’s arrival sees him succeed, senior partner, Michael Napier and is predicted to draw external investment in the firm.

John Pickering is the Group Chief Executive:

“This is an important appointment which again signals our intention to take advantage of the opportunities we think the Legal Services Act and moving to ABS status will offer us.”¹

It is estimated the Solicitors’ Regulation Authority has received over 65 first stage ABS applications and is now working on creating a series of bespoke second-stage application packs. These personalised packs will reflect the nature of the proposed business as well as requiring detailed information about the owners.

Despite indications that the SRA will approve its first ABS licence by the end of February, the third stage of the ABS process actually allow the regulator six months to examine and evaluate the application before beginning required to reach a decision. Should it then require additional information, it can extend the decision date for a further three months.

¹The Lawyer (Jan 2012)

The challenge of moving house has been cranked up a gear as the total cost has rocketed by 69 per cent over the last ten years, according to Lloyds TSB.

Renowned for being one of life’s most stressful experiences, moving house now costs on average £8,922 compared to £5,290 in 2001.

This staggering increase, one that even exceeds the escalation of house prices (64 per cent) over the last decade, has occurred due to a culmination of price rises from estate agency fees (up £1,318) to Stamp Duty (up £732) to removal services (up £305).

Mortgage fees have also increased by £770 with many lenders compensating for lower mortgage rates with augmented fees.

The soaring costs are forcing movers to use savings (61 per cent), family and friends (18 per cent) and even credit cards (16 per cent) to cover the costs.

Stephen Noakes, Director of Mortgages at Lloyds TSB, has this suggestion:

“With the cost of moving at its highest level since 2007, consumers struggling to cover the costs should look to make savings wherever they can. With mortgage fees making up around 12 per cent of the overall outlay, considerable savings could be made by looking at a fee-free mortgage option.”¹

¹Mortgage Solutions (Jan 2012)

There has been a reported increase in the number of people using equity release to pay off all debts before they enter into retirement, according to Andrea Rozario, Director General of Safe Home Income Plans (SHIP).

According to The UK Insolvency Debt Advice Service, a quarter of all UK pensioners are still to pay off their mortgage in full. In the most vulnerable cases, pensioners have to survive on just £42 a month after settling all their monthly outgoings¹, a far cry from the frivolous and fun retirement we have all come to expect.

Those who had taken out an interest-only mortgage are at particular risk as Rozario points out:

“We are seeing more people turning to equity release to consolidate debts as they come into retirement.

“It could be they had an interest-only mortgage previously – with a view of selling and paying off that mortgage.

“They may find that they no longer wish to do that and they find they have another option – which is to take out equity release.”²

But it is not just mortgage debt which is prompting an increase in equity release activity. Poorer pensions and depleted savings have also significantly contributed to people considering releasing equity from their homes to help fund retirement.

¹Bankruptcy-Insolvency
²Prudential (Jan 2012)

It takes low and middle income (LMI) earners, on average, 22 years to save enough money for a deposit for their first property, according to Resolution Foundation.

In its report, Squeezed Britain, the independent think tank cited the shortage of higher LTV mortgages as a primary reason for LMI households remaining stuck in rented accommodation. 52 per cent of LMI earners now have the belief they will never own their own home.

LMI earners are classed as those bringing in an income which is below the UK average. For couples without children, this is £12,000 - £29,000 and for couples with children, it is £17,000 - £41,000.

LMI earners under 35 have seemingly taken the biggest battering. According to the report, just over a third of this group now own a property compared to 51 per cent six years ago. Parallel to that, LMI households under 35 who now rent has more than tripled over the last 25 years; in the late 1980s just 14 per cent rented while now 47 per cent do.

And now taking that first step is about to get even harder as the Stamp Duty exemption for FTBs is set to come to an end in March.

Without the exemption, FTBs will have to pay an additional 1 per cent on house purchases between £125,000 and £250,000 and from 3 per cent upwards on houses valued over £250,000 on top of the large deposit required, something the National Association of Estate Agents (NAEA) fears could have a disastrous impact on this already fragile market.

Wendy Evans Scott is the President of the NAEA:

“First time buyers are key to a healthy property market. We hope to see the number of people completing the purchase of their first home continuing to increase through February and March, as many first time buyers are keen to purchase their first home before the tax exemption deadline.

“However, it is impossible to predict what impact the end of the tax exemption will have on first time buyers, particularly those on very tight budgets of under £250,000 for whom the 1 per cent tax could be disastrous.

“The government will need to monitor sales closely and consider other action to support the fragile first time buyer market.”¹

¹Mortgage Strategy (Jan 2012)

The Institute of Advanced Motorists (IAM) has renewed its call to the government to include training on single-carriage rural A-roads in the current practical driving test in an attempt to improve road safety and reduce road traffic accidents.

According to its research, 82 per cent of rural fatal and serious casualties occur on single carriageway roads while only 18 per cent take place on motorways and dual carriageways roads.

The IAM blames new driver inexperience for this significant difference and believes the current driving test should be changed to incorporate such training, something new drivers would actually welcome.

According to its recent report into younger drivers, The Fast and the Curious, new drivers readily admit feeling unprepared for real life driving scenarios.

Despite accounting for only 8 per cent of all driving licence holders, 30 per cent of road accident fatalities are drivers and passengers aged 17-24. IAM, whilst acknowledging the importance of learning such driving skills as parking and low speed manoeuvres, is adamant that dealing with high speed corners, bad weather and overtaking is far more vital to strengthen new drivers’ skill set.

Simon Best is the IAM’s Chief Executive:

“More than half the cars on our roads are rated as four or the maximum five-star in European safety tests, and the figure is even higher for new cars. Our roads are also getting safer in their design.

“But the roads where drivers, especially young drivers, are most frequently killed and injured are still not consistently part of the driving test. The minister recently announced young drivers would be allowed to use motorways when accompanied by an instructor, but it is single carriageway A-roads where the real problem lies.

“Driver and driver error is a contributory factor in two thirds of accidents. We can only improve our cars and roads so far. The challenge now is to improve the humans that drive them, to continue our outstanding record of road safety.”¹

¹IAM (Jan 2012)

It has been nearly three weeks since the Solicitors Regulation Authority (SRA) opened its doors to Alternative Business Structure applications, with confirmation that around 50 first stage applications have been received. Yet despite this, many seem somewhat unfazed by what has been dubbed “the biggest change in the provision of legal services”.

However, with the SRA confident it will issue the first licence by the end of February, now is not the time to adopt a wait-and-see attitude.

There has already been a hint or two regarding the legal world post ABS; the launch of the website RoadTrafficRepresentation.com, where people charged with a motoring offence can receive a free online diagnosis of their case, a prime example.

Alternative Business Structures are about making legal services more accessible and simple for the consumer and it is initiatives such as RoadTrafficRepresentation.com that are ultimately testing the water and shaking up the traditional manner of obtaining legal advice.

In order to be ready for the storm, it is vital to take action now. If you are interested in discussing how setting up an ABS could benefit your business, contact Senior Partner, Eddie Goldsmith.

53 per cent of brokers are predicting an increase in their buy-to-let business in 2012, according to a recent survey by Paragon Mortgages.

Of that 53 per cent, 19 per cent are expecting an increase in business of 10 per cent or more. Only 3 per cent are expecting to do less BTL business this year.

John Heron, managing director of Paragon Mortgages, is pleased with this positive outlook in the midst of financial uncertainty:

“2012 is set to be another challenging year for the buy-to-let and general mortgage market as we continue to feel the impact of the eurozone crisis and wider economic factors.

“However, it’s positive to see the level of optimism among intermediaries and the fact that more than half expect to increase their level of buy-to-let business throughout the course of the year.”¹

Lenders too appear confident in the buy-to-let market.

After entering the market in December, Abbey for Intermediaries has launched four new loans as well as cutting its rates by up to 0.20 per cent. Products include a two-year fixed rate at 3.39 per cent with a 2.5 per cent fee up to 60 per cent LTV and a two-year tracker with a rate of 4.09 per cent and a £1,495 fee available up to 75 per cent LTV.

Yorkshire Building Society has also broadening its BTL lending. Having initially only lent to London and the South-East, the building society will now be extending to the whole of England and Wales from Monday. It is also decreasing its minimum property value from £150,000 to £100,000, reducing its minimum applicant age from 32 to 25 and decreasing its minimum income requirements from £35k to just £20k. It is also lifting its 40 mile distance restriction between borrower and property location.

Woolwich is also set to relaunch its 75 per cent LTV BTL mortgage which it was forced to withdraw in November. The deal will only be available direct initially but with plans to extend to brokers when it is confident systems are ready.

¹Mortgage Strategy (Jan 2012)

The AA has voiced its outrage after new figures, released in a House of Commons written statement, revealed the average fine for people caught driving without insurance is just £200.

On average each year, there are 160 road accidents fatalities and 23,000 road accident injuries caused by uninsured drivers. Simon Douglas, Director of AA Insurance, thinks honest motorists are being failed by such lenient fines:

“I certainly think that the UK is far too soft on hard-core uninsured drivers and most people will consider a fine of £200 is an insult.

“Although there is a fixed penalty of £200 and six penalty points for driving without insurance, the police will prosecute for serious offences – yet the fines imposed by the courts are often less than that. It is hardly a disincentive, given the typical cost of insurance for someone aged between 17 and 22 is around £2,500.”

Douglas also dismisses the argument that, in most cases, the uninsured driver’s vehicle will be confiscated with the value of which adding to the cost of the fine.

“Most of these were old and with little value; as well as being poorly maintained or even downright dangerous.”

When asked what he deemed a just punished for uninsured drivers, Douglas said:

“I believe uninsured drivers should pay the equivalent of the unpaid insurance premium, which can be easily calculated, in addition to a fine. What’s more, the fine should be sufficiently great to make them think twice before offending.

“This could be coupled with community service orders and for repeat offenders, possibly custodial sentence.”

Anyone who is involved in a road traffic accident with an uninsured driver is still entitled to compensation. The Motor Insurers’ Bureau (MIB) provides a compensation fund that is there to help reimburse victims of accidents with uninsured/untraceable drivers.

Goldsmith Williams can make a claim on your behalf against the MIB under the Uninsured Drivers’ Agreement. Contact us today to see if you have a claim for compensation. Call us on 0845 373 3737 or by completing our online enquiry form.

¹News Insurances (Nov 2011)

Loan-to-value (LTV) mortgages of 85 per cent and above increased 32 per cent in 2011, according to e.surv. There are currently 57,301 85 per cent and above LTV mortgages available, up from 43,379 in 2010, making lending conditions at their most accessible since August 2007.

Meanwhile, house purchases enjoyed a year-on-year increase in November for only the second time in 2011, according to the Council of Mortgage Lenders (CML).

47,000 loans (£6.9bn) were advanced in November, an increase of 3 per cent and 5 per cent by number and value respectively when compared to 12 months prior and 4 per cent and 5 per cent on the previous month.

17,300 loans (£2.1bn) were taken out by first time buyers, an increase of 4 per cent by volume and 5 per cent by value year-on-year and month-on-month. Such an increase was always expected as more and more first time buyers rush to take advantage of the Stamp Duty concession before it ends in March.

Paul Smee, Director-General of the CML is encouraged by the figures:

“A rise in mortgage lending towards the end of 2011 is a welcome indictor for the industry considering confidence has been weak due to fragile economies both at home and in the eurozone.”

Richard Sexton, Director of e.surv, agrees:

“The improvement in 2011 is modest, but when taken against the backdrop of the eurozone crisis and turgid economic growth, it’s clear the market has demonstrated real staying power last year.

“Banks have made a concerted effort to increase the amount they lend to first time buyers which is reflected in the big jump in higher loan-to-value lending. They are also supplementing this with more lending to buy-to-let investors.

“It’s important,” he added, “to keep things in perspective. The gains over 2011 shouldn’t be taken as a portent of a return to the sunnier climes of the pre-2008 market.

“2012 will be a difficult year. Banks will pass the increased cost of funding themselves onto the consumer, and will likely focus on hoarding capital rather than new lending. A flat market looks like the best we can hope for.”

A significant number of homeowners believe their home will “buck the trend” and increase in value during the first half of 2012, according to a recent survey by Zoopla.co.uk.

55 per cent of homeowners expect house prices to increase overall, down 4 per cent quarter-on-quarter. Despite this drop, the majority of homeowners are confident the value of their own property will rise and outdo other properties in the area.

Just 24 per cent of those surveyed believe the value of their home could drop, while 29 per cent of expect house prices in their area will decrease.

These figures come around the same time as The Royal Institute for Chartered Surveyors deemed unrealistic house prices a contributing factor to the housing transactions.

Ian Perry is the RICS housing spokesperson:

“The increasing number of prospective sellers who placed their homes on the market in December is a positive development as a lack of stock has been a big issue in some parts of the country.

"But with sales expectations remaining flat, it is important that vendors are realistic in their pricing if they wish the sale to go through in good time."¹

¹Mortgage Solutions (Jan 2012)

Comments from senior partner, Simon Cottrell, regarding the Transport Committee’s follow up report on the cost of motor insurance:

"Clearly, there are problems within the industry and I welcome the fact the Government is looking into it, but today’s report raises a key question.

“There is a deafening silence as to how much the insurance industry would be prepared to reduce premiums by if the Government were to uphold some or all of the recommendations put forward.

“The sector is claiming that premiums have risen as a result of whiplash injuries and fraudulent claims, but the reality is that the cost of insurance has rocketed as a consequence of many factors. Premiums have increased due to the need for insurance companies to make profits in a depressed market, extremely large compensation payouts have hit the sector hard, in addition to price comparison sites driving down profit margins as insurance companies have had to compete fiercely with rivals for business.

“The industry is continuing to peddle the illusion that whiplash claims is the only root of spiralling premiums which is absurd. Whiplash injuries are soft tissue injury and there is no absolute way to diagnose the severity of it. It is offensive of Jack Straw to say that they are assessed by third rate doctors.

“I don’t support the practice of making unsolicited calls to would-be customers, nor do I tolerate fraudulent claims. If referral fees are banned payments will continue to be made between parties under a different name. Nobody has the stomach to monitor this.”

At the start of a new year, people tend to do two things: look back on the previous 12 months and take stock of what they’ve done and achieved and look forward to what the next year potentially has in store.

It is fair to say 2011 was a bit of a mixed bag – some bits good, some bad and some downright ugly. One of the ugliest was that of the first time buyer.

There weren’t many times when the plight of the first time buyer didn’t make the headlines. Solutions were desperately sought - from FirstBuy to Mates Mortgages – with some ultimately more successful than others. There was even the return of the 100 per cent loan-to-value (LTV) mortgage.

While first time buyers continued to feel the wrath of the harsh market, buy-to-let began to find its feet again. Rents hit record highs month after month and, in July, average rents for England and Wales smashed the £700 mark while average London rents exceeded £1000 a month. High tenant demand largely contributed to these increased rents while the historically low base rate allowed landlords to lock in a low rate remortgage deal.

Like buy-to-let, equity release was another saving grace for the property industry. Poor pensions, debt, depreciating savings and children in need all contributed to an increase in equity release activity; Q3 seeing a 12 per cent year-on-year increase. The market is looking so promising that 55 per cent of brokers are considering getting in on the action in the coming 12 months.

And with mention of 2012, our vision spins forward. Will the New Year, an Olympic year, be a winning one for those in the property game? Sadly not if the members of the Intermediary Mortgage Lenders Association (IMLA) are to be believed.

IMLA members foresee challenging times ahead, predicting gross mortgage lending will fail to surpass £130bn, resulting in a £8bn lost year-on-year. They are also expecting unemployment levels to remain high with the potential of further increase.

Peter Williams is the IMLA Executive Director:

“The survey results may look negative but represent a realistic outlook for the year ahead and remind us that we are still in very challenging times for the economy.

“The mortgage market remains very limited, which is why intermediaries can play such an important role to help inform consumers about the best products available and what is right for them.

“Matching lenders and products to consumers is crucial to ensure sustainable lending and improve the market.

“Council of Mortgage Lenders figures show that intermediaries accounted for nearly two-thirds of sales – 64% of first-time buyer loans, 57% of remortgage loans and 52% of home mover loans – during the third quarter of 2011.”¹

But alas without that proverbial crystal ball, only time will tell if these predictions come true. One thing is certain however as Clint "Blondie" Eastwood pointed out: "We're going to have to earn it!"

¹Introducer Today (Jan 2012)

With many consumers concerned about their finances for the forthcoming year, equity release could help offer some financial relief.

According to a recent survey by uSwitch, more than half of the people in the UK are feeling unconfident about their finances in the New Year with nearly one in four believing they will be financially worse off in 2012 than they were in the previous year.

76 per cent of those surveyed are worried about the rising cost of living while 63 per cent are specifically concerned about household bills. Approximately half will see their disposable income shrink with a further one in ten seeing it vanish completely. In short, 2012 appears to be the year of getting by rather than living.

Michael Ossei is the Personal Finance Expert at uSwitch.com:

“2012 looks set to be another difficult year with consumers already geared up to cut back, curtail spending and try to clear outstanding debt. Instead of the fresh start many were hoping for, 1st January may just signal the start of yet another tough and frugal year.”¹

For those in need of additional revenue, equity release could offer the solution.

Equity release allows those aged between 55 – 95 who own a UK property worth at least £50,000 to utilise what would otherwise be stagnant equity in their home. Money can be accessed via a lump sum payment or via access to cash reserve where funds may be drawn periodically when needed the most.

Equity Release is now a significant option in retirement financial planning and further advice and assistance should always been sought from both a qualified financial adviser and a specialist solicitor such as Goldsmith Williams.

¹uSwitch (Dec 2011)

On the 3rd January, the majority of us returned to work after a restful festive period. But, while many of us gently ease our way back into the old routine, those at the Solicitors Regulation Authority (SRA) don’t have such a luxury as applications for Alternative Business Structures have started flooding in.

On Tuesday, the SRA released new information about the ABS application process and confirmed that it is in “serious talks” with approximately 15 interested parties. Amongst them are The Co-operative and Irwin Mitchell.

Applications can be started via the SRA website with the completion of an “expression of interest”. To date, more than ten first-stage applications have been made online.

On receiving an application, the SRA’s dedicated ABS team will review the information before creating a personalised application pack for the applicants to complete. Due to the bespoke nature of this approach, the fee will vary depending on the application’s complexity. However, it will comprise of a £2000 flat fee plus an additional £150 per person planning on providing legal services. As part of the process, each person will be individually assessed to ensure they are appropriate ambassadors for the legal profession.

Ann Morgan is the SRA’s ABS Team Leader:

“One size doesn’t fit all, so we’ll have to assess each application on its merits. While the preparation work has been very comprehensive, we will need to remain flexible in our approach to deal with these new firms.

“What we do know is that we have to be rigorous and robust – as robust as we are with traditional law firms. For example, we’ll be asking for the employment history of everyone going back five years – we need to have detailed information relating to those who want to be regulated by us.”¹

The SRA is predicting the typical approval process will take up to six months from receiving a completed application. However, where possible, it will make a quicker decision.

The first SRA-approved Alternative Business Structures licences are expected to be handed out towards the end of February.

¹Legal Week (Jan 2011)

55 per cent of brokers are considering offering equity release advice in the next 12 months, according to a recent survey by Mortgage Solutions.

While 2011 has been another tough year for other areas in the property industry, equity release has flourished. Q3 figures saw a 12 per cent year-on-year increase¹ and, according to a survey by the Equity Release Solicitors Alliance (ERSA), 38 per cent of UK homeowners are considering using their home to help fund retirement².

However, given the complex nature of equity release products, it is essential for brokers to have the right qualifications needed in order to give customers the best possible advice.

Claire Baker is the Chairperson of ERSA:

“It is really encouraging to see that so many advisers are considering entering the equity release market.

“For those prepared to commit themselves to the sector, the indictors show the equity release market is set for strong growth in 2012.

“We would suggest the first step for advisers who do wish to advise on equity release should be to engage with SHIP – which is now the trade body for the entire industry – to find out more about the market and also about what qualifications they will need to take.”³

¹Mortgage Solutions (Oct 2011)
²IFA Online (Nov 2011)
³Mortgage Solutions (Dec 2011)

Last week we had a gentle reminder of the potential havoc that could hit our roads as the first flurry of wintry weather landed. Yet despite this, and the previous three years of bad weather, 38 per cent of drivers have failed to take any measures to safeguard themselves and their vehicles¹.

Last year, the severe weather contributed to 2,328 accidents in which there were 20 fatalities and over 3,000 casualties².

Following three consecutive years of bad weather, many drivers are expecting councils to be better prepared for another difficult weather season. However, according to the Institute of Advanced Motorists (IAM), 67 councils are likely to have a smaller budget to spend on winter road services than last year². This alarming news highlights the need for drivers to take matters into their own hands to avoid a road traffic accident this winter.

According to the AA Populus panel, just 4 per cent of road users have bought winter tyres. This however is up on last year (3 per cent). 7 per cent have purchased all-season tyres¹.

42 per cent of drivers have put breakdown provisions in their cars such as shovels and blankets while 39 per cent have invested in a pair of walking boots¹. Whilst these figures are all up, there are still over a third of motorists completely unprepared for the risks of winter driving.

The AA has produced a winter check list, including a winter emergency kit, in an attempt to help drivers avoid road traffic accidents this winter.

¹AA (Dec 2011)
²IAM Driving Road Safety (Nov 2011)

After all the fun and frolics of the festive period, January is a time for detox. Detox of body and mind and also of our finances which is why the New Year could be a great time to remortgage.

The first post of the New Year always seems to be accompanied by a heavy thud as the weight of credit card bills and store cards drop onto the mat. However, many households could ease their post-Christmas financial blues by remortgaging.

According to a recent study by Barclays, the average homeowner could save up to £1200 a year by remortgaging. Many homeowners are unaware of the financial benefit of remortgaging; often dismissing the idea as more hassle than it’s worth. In its survey, Barclays discovered many homeowners believed remortgaging would only save them around £10 a month and therefore haven’t considered it as a viable money saving option.

Andy Gray is the Head of Mortgages at Barclays:

“The fact that around six in 10 homeowners have never changed their mortgage outside of moving house suggests that they simply don’t realise the levels of savings to be had by remortgaging.

“As monthly outgoings rise, and Britons fight to cut their costs, it’s important that they consider addressing their mortgage.

“There are an increasing number of good mortgage deals to be had so we are urging homeowners to act now and look at the rate they are paying, to allow them to get more out of their hard-earned cash.”¹

¹Mortgage Strategy (Nov 2011)