The Turner Review of Global Banking Regulation dominated the headlines this week although it stopped short of restricting mortgage lending to no more than three times borrowers' income or banning 100 per cent home loans. Journalists also considered whether longer-term fixes are now a sensible option as rates come down and whether offset mortgages are suitable for those with savings which are not otherwise earning much interest.
Melanie Bien, spokeswoman for Savills Private Finance, was quoted in a range of articles - a selection of which are below.
Melanie Bien was quoted in Telegraph Money (21/03/09) as saying that the Turner Review would not change anything in the short term. She said: 'The Turner Review was not quite as prescriptive as some rumours led us to believe it would be. Instead of capping borrowing at three times income or banning 100pc loan-tp-value (LTV) mortgages, the FSA took the more reasonable route of announcing further consultation. If the Government introduces some form of mortgage indemnity guarantee to solve the issue of lenders refusing to advance higher LTVs, then there is a case for being able to influence criteria and potentially insisting on no more than three times income or other restrictions if necessary. But otherwise the Government should not be able to influence criteria - it would have negative consequences, as well as being extremely difficult to enforce.'
In the Financial Times (21/03/09), Melanie Bien said in reference to long-term mortgages: 'An increasing number of borrowers are considering longer-term fixed or tracker rates. Although interest rates are at historic lows, they remain volatile and are unlikely to stay this cheap in the longer term. She felt five-year fixed rates were particularly good value as they had fallen in recent weeks. 'Anything around 5 per cent or less is historically extremely competitive,' she said.
The Times (20/03/09) offered ten tips for buying property. Melanie Bien commented that obtaining mortgage finance is a challenge but not impossible. 'You need a good deposit and a squeaky-clean credit history. You also need a deposit of 25-40 per cent to take advantage of some of the better deals.'
The Express (18/03/09) looked at offset mortgages and whether homeowners earning paltry rates of interest on savings could save thousands of pounds by using spare cash to cut mortgage bills. Melanie Bien said: 'Rising unemployment means cash is king, so hanging onto it, rather than paying off a chunk of the mortgage, is very appealing. Homeowners can then use the cash to pay other household bills if necessary, for example.'