The Importance of Valuation Instructions
Phimister v DM Hall LLP [2012] CSOH 169 The issue was the scope of the surveyor’s duty to a purchaser. Phimister sought damages from DM Hall for professional negligence in respect of a mortgage valuation report, on the grounds that the firm owed him a duty of care to check the area of the property […]
Buy to let lending – solicitor conflict of interest
It appears that a number of solicitor firms are just starting to test the subtlety of some of the requirements and provisions of the recent changes to the Solicitors Regulation Authority Code of Conduct 2011. One challenging area relates to conflicts of interest in respect of “buy to let” transactions. Chapter 3 of the SRA […]
Interest Only is it really a ticking time bomb?
The MMR clearly retains the overarching ‘responsible lending’ rule, but one of the key elements of the reforms specifically focusses on interest only. In a nutshell, from April 2014, when the new rules kick in, lenders must assess affordability on a capital and interest basis, unless there is a clearly understood and believable alternative source […]
Interest only back books
The FSA announced, in the most recent “Retail Conduct Risk Outlook 2012” review, that a thematic review is about to be commenced. Their concern is that in the medium to long term, the outstanding balances, as well as the LTV percentages of these maturing mortgages, are expected to increase significantly. It is hoped that the […]
Risk Identification
When driving a car it’s obvious that you need to keep your eyes on the road ahead, but it’s a poor driver who does not look in the rear view mirror from time to time or learn from past driving experiences. Similarly within the mortgage industry we are all focused on the way ahead, hoping […]
Is forbearance finished?
Paul Diggle at Capital Economics recently tried to quantify how important a role forbearance has played in propping up the UK housing market. He estimated that without lenders – leniency, arrears and repossession could be double the current rate. He also suggests that had banks been less forgiving, then the proportion of mortgages currently three […]
Regulation of Credit Rating Agencies
The European Mortgage Federation (EMF) has recently reiterated their support for the European Commission (EC) proposal to amend the Regulation on Credit Rating Agencies (CRAs). In particular it supports the measures designed to reduce the risk of conflicts of interest and measures aimed at enhancing the quality and transparency of ratings. However, the EMF is […]
Mortgage forbearance and impairment
On the 5th October the FSA published its final guidance on forbearance and impairment provisions following consultation and review of lenders arrears processes. The review was designed for the regulator to understand forbearance strategies used by lenders, identify good and bad practice and ensure that clear and transparent reporting was in place. The results of […]
FSA Oversight
The recent announcement by the Financial Services Authority (FSA) that it expects bridging lenders to behave with “the same high standards” on unregulated business as on regulated business has opened up an interesting debate. We have long held the view that a regulated lender entity has an overriding responsibility to behave in an appropriate manner […]
Scullion v Bank of Scotland Plc – our view
On a superficial reading the recent Scullion v Bank of Scotland Plc (t/a Colleys) [2011] EWCA Civ 693 decision may appear to have little relevance to lender/valuer professional negligence claims as the case related to a consumer litigating against a valuer. However, it is our view that the decision could impact on lender/valuer disputes and […]
