News analysis: Calls for reform of FOS mount
By Leah Milner 6
th April 2021 12:04 pm
There are mounting calls for the Financial Ombudsman Service to be more transparent and accountable amid controversy over its complaints backlog.
Last week, a report by the Institute for Economic Affairs branded the complaints body “unfit for purpose” and made a case for “major reforms”.
The Association for Mortgage Intermediaries agreed with many of the think tank’s findings and has also called for structural changes.
In December, FOS admitted to the Treasury select committee that it was dealing with a pipeline of more than 23,000 open cases that are more than two years old. Industry commentators have asked how the service will be able to clear this workload as well as the high case numbers resulting from the pandemic when it is also in consultation with staff about cutting 150 roles.
Adam Hosker is director of Bespoke Finance
The mortgage guarantee scheme will give confidence to lenders returning 91%-95% LTV. Enabling households to purchase new build or existing homes. Helping first-time-buyers and existing homeowners alike.
The government will fully guarantee losses from lenders up to 80% of the purchase value. Then partially guarantee losses above that, up to 95% of lenders costs for up to seven years.
The eligibility is open to most purchases up to £600,000 purchase price on repayment mortgages. It won’t be available for buy-to-let, but no restrictions on landlords buying a new home.
The real restrictions will remain with mortgage lender criteria. With the new scheme doing nothing to alleviate affordability, unlike the Help-to-Buy scheme.
LSL, owner of Reeds Rains and Your Move, has acquired Mortgage Gym for £2.4m as part of its digital strategy to drive growth in financial services.LSL has also acquired a 60% stake in Direct Life Quote Holdings for £1.8m.
LSL is one of the largest providers of services to mortgage intermediaries and mortgage and protection advice to estate agency customers, currently representing around 9% of the total purchase and remortgage market, with 2,600 financial advisers.
The investment in Direct Life Quote Holdings aims to help both PRIMIS members and LSL’s directly employed advisers to increase their sale of protection products for the benefit of clients and customers.
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Updated (Image: BBC/Channel Four)
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Head 2 Head: Should mortgage brokers diversify into areas such as wealth management?
By Rebekah Commane 22
Yay
Carl Parker, head of self-employed division, Just Mortgages
The current boom has brokers rushed off their feet but transactions may drop away in April if the stamp duty holiday ends, so brokers will need to be prepared to diversify. If there is one thing we have learned both during the financial crisis and at other times since, it is that there will be quieter periods. When these quieter times come around, brokers who advise only on mortgages tend to struggle.
One area of growth is wealth management. With savings across the UK increasing by £75.5bn during lockdown, there is a huge need for sound financial advice on a much wider scale.