AT THE risk of stating the blindingly obvious, it's not an easy time to buy a home. Although house prices are falling, mortgage availability has shrunk dramatically in the past year, while anyone without at least a 10 per cent deposit is considered too high a risk by most lenders.
According to the Edinburgh Solicitors Property Centre, the housing market badly needs first-time buyers to return. It says that part of the reason they are staying away is the perception that there are no mortgages available. This isn't the case wher
e buyers can demonstrate affordability, and there's truth in the suggestion that negative coverage of the housing market has kept some potential buyers away from the market.
But while we could talk up the housing market a little more, mortgage lenders really don't do themselves any favours. This week Halifax, part of HBOS, introduced a new £245 "mortgage account fee". It effectively replaces the £175 mortgage exit fee it scrapped a year ago, when the Financial Services Authority ruled that exit fees were unfair as borrowers were often charged higher fees than they expected. Lenders have since refunded millions to borrowers who paid excessive exit fees, but they have simply found new ways of recouping the lost revenue by renaming their charges. The mortgage account fee is just one name used to rebrand exit fees – others include "core term fee" and "mortgage administration fee".
Valuation fees add to the confusion, according to research by Edinburgh-based online mortgage company mform, which found that they can range from £0 to £419 – for the same house.
The way in which fees are manipulated to help lenders maintain margins at the expense of clarity hasn't gone unnoticed, as the Chancellor, Alistair Darling, weighed in this week by condemning high fees as being unfair to borrowers. Darling even said he would ask the Financial Services Authority to intervene if banks continued levying excessive charges.
The message for borrowers is to take into account all fees when calculating the true cost of a loan, and with little consistency in the size and application of charges, shopping around is advised. While fees can have a purpose, all too often they merely add new layers of costs and complexity for borrowers to negotiate.
It's in the interest of lenders to stimulate the housing market and encourage buyers.
But any additional barriers borrowers encounter could send a vulnerable housing market deeper into the mire.
YESTERDAY was Veteran's Day, which aims to raise awareness of the contribution made by those who have served in the armed forces. But what also needs highlighting is the cause of the Armed Forces Pensions Group, which campaigns for equal rights for veterans.
Since 1975, members of the armed forces with five years or more service and aged 26 or more have qualified for an inflation-proof pension from the age of 60. Amendments to the rules 13 years later cut the required service to two years and did away with age restrictions.
But thousands of servicemen and women who left the forces before April 1975 with less than 22 years service were given no such pension entitlements. The issue has been debated in parliament, but the government has stuck steadfastly to the excuse that it can't backdate pension payments. This entirely misses the point, as campaigners merely seek concessions that would allow veterans to benefit from now on.
For more information, visit
www.afpg.info.
