Last week’s pre-budget report dominated the weekend money pages, with most newspapers looking at how Alistair Darling’s announcements would affect their readers. Although the mortgage-related stories were sparse, the themes remained the same; the market is still tough and deals remain scarce and price dependent on loan-to-value.
The Mail on Sunday revealed that nothing the Chancellor said last week will make a difference to the mortgage firms who continue to charge steep rates for those with little equity in their property. The bank’s stubborn refusal to turn on the mortgage tap means hundreds of thousands of borrowers remain stuck on unaffordable deals. The Sunday Times noticed that Banks have come under fire for failing to cut interest rates and offer new deals after huge falls in wholesale funding costs, which in recent weeks have reached pre-credit crunch levels. It was also noted that brokers have attacked Labour’s pre-budget report for failing to do enough for borrowers, amid warnings by a government-appointed expert that mortgage approvals could soon dry up altogether if more isn’t done to boost lending. Elsewhere, the Financial Times revealed the establishment of a new mortgage consultation group, announced in the pre-Budget report this week, is unlikely to bring about better rates for borrowers. Next Tuesday, members of the government’s new lending panel, comprising banks and building societies, regulators and consumer groups, will meet. They are expected to discuss issues such as repossession and alteration of loan terms at short notice.