Sub Prime lenders

emmaHarris_2

Yes Joe...but what they wont tell you is by lender etc. This will be published very soon. At least between us we are getting the information out there

Garry_Anderson

emmaHarris wrote:

The figures and trends 2001 - 2006 can be viewed HERE

There seems to be a problem in some of the totals:

20115 13241
17042 12622
16098 11773
14193 10193
67448 47829
67448 47829 <you have

17559 10807
15069 11318
16292 9569
15228 9495
64148 41189
64148 41279 <you have - total wrong

15997 9616
16336 10062
16729 10610
17967 10394
67029 40682
67029 40682 <you have

19155 11250
18675 11404
19359 11862
20667 11893
77856 46409
77856 46409 <you have

25869 14041
28475 18325
19359 11862
20667 11893
94370 56121
115352 70844 <you have - total wrong

saver_sam

Garry-These figures appear to come direct from the dca website, so its the dcas fault they are incorrect. the last big increase on their pdf does say it was revised but nothing against the other for why they are wrong.

However, the possession figures also take into account those that have been surrendered voluntarily and the whole of the UK, so that would probably include Scotland and NI too, perhaps inflating them when they are actually lower in E&W.

Without knowing all these facts of what all the columns mean on the data that is on the townandcountry website and how many were actually repossessed, the figures just by themselves might look alarming.

emmaHarris_2

Good morning Garry, first these are not my figures, I didn't post them but I will take a look now and get back to you.

emmaHarris_2

Hi Garry, I have just checked the ones you said were wrong but they seem ok to me. I suspect that they have updated them since you first viewed them as I see new menu items on there too. I do see a few differecnes as well in some of the Quarterly figures and the totals seem to be right. Somene has obvioulsy checked the programmers copying skills.

Garry_Anderson

emmaHarris wrote:

Hi Garry, I have just checked the ones you said were wrong but they seem ok to me. I suspect that they have updated them since you first viewed them as I see new menu items on there too. I do see a few differecnes as well in some of the Quarterly figures and the totals seem to be right. Somene has obvioulsy checked the programmers copying skills.

For some reason I thought it was you who put the figures on the site.

Yes - you are right, quarterly figs have been updated - 2005 now shows:

Q1 25869 14041
Q2 28475 18325
Q3 29990 19694
Q4 31018 18784
115352 70844

It was:

Q1 25869 14041
Q2 28475 18325
Q3 19359 11862
Q4 20667 11893
115352 70844

Therefore it was third and fourth quarter figures entered wrong - I thought they might be - the large drop indicated something was different (18325 to 11862).

emmaHarris_2

Your right. It is as they told me still work in progress. I understand there is more information to come yet and thank you Garry for pointing it out it is crucial that we do get it right but I think they noticed some time yesterday or last night anyway.

emmaHarris_2

Just a quick note in regard to transferring or selling mortgages (securitisation/whole loan sales).

The mortgage offer will provide a line to say "...that we 'may' sell or transfer your mortgage at anytime to anyone etc"

This is provided at the very last minute at the signing stage - after verbal agreement has been given and some 8 weeks after he application thus ensuring that the borrower has not gone elsewhere.

Considering that the whole loan sale/securitisation requires negotiations and deals to made and the borrower/mortgage types pre-agreed 12 to 18 months in advance, it is strange they would use this minimal term and particularly when thier business module and annual accounts show that they carry this out 100% of the time and in disregard to the FSA - MCOB guidelines and of course the 'spirit' of using these guidelines, as follows:

MCOB 6.4.16 If the firm knows at the point that the offer is made to the customer that its interest in the regulated mortgage contract will be assigned (by sale or transfer) and the firm will no longer be responsible for setting interest rates and charges, the offer document must:
(1) state this; and

(2) state, where known, who will be responsible for setting interest rates and charges after the sale or transfer.

MCOB 6.4.17 Where MCOB 6.4.16 R applies, if the name of the party who will be responsible for setting interest rates and charges after the sale or transfer is not known at the point the offer is made, the firm must notify the customer of this as soon as it becomes known.
MCOB 6.4.18 MCOB 6.4.16 R and MCOB 6.4.17 R could apply where the ownership of a regulated mortgage contract is transferred to a third party through securitisation.

Most transfers take place within a couple of weeks after signing the contract, sometimes shorter.

http://fsahandbook.info/FSA/html/handbook/MCOB/6/4?searchtext=mortgage%20transfer&searchtype=boolean

emmaHarris_2

Of course Brokers and Mortgage Advisors are aware of this too as they are aware of the business module used by sub prime lenders. Thankfully, not many advisors here advocate sub prime lenders and will whenever possible provide advice on the best deal and keep borrowers in the mainstream markets, even if it means paying a 'point or two' above, as the long term effects based on the unknown can be very costly overall in other ways.

Sometimes it is better to rent and fix your credit yourself than take out a mortgage with a sub prime lender...it really is a different market!

emmaHarris_2

EdInvestor wrote:

Emma

If you have evidence of bad treatment and harassment of borrowers by HML, then I suggest you present the evidence in a complaint directly to its owner, the Skipton Building Society.

Mutually owned building societies as you know are always very concerned about their image as supporters of their local community and are very unhappy if this image is besmirched ( such as by unpleasant reports in the media).

I am sure that the management of the Skipton will take action to sort out any problems at its subsidiary straight away. If they don't and they have no proper explanation of these allegations, then I suggest you post their response here so that consideration can be given to taking the matter further.

Re securitised mortgages, it is the top quality prime mortgages, which are normally favoured for packaging and selling in the market through securitisation. This is because you can get more money for them, as the borrowers don't usually default.

This is important because what the buyers of the mortgages want is the "yield" - the income stream which comes from the borrowers making their monthly payments. Obviously the last thing that's wanted is a borrower who defaults - which is more likely in the sub-prime area.

Thank you for your advice above and to post here in answering your reply.

First of all HML or Homeloans Management wish to be kept in the background and are indeed surprised to learn that consumers are even aware of their existence. Of course they wish to portray that they are the company that they represent.

The company they represent dictate and set the standards of service levels and we suspect through experience and the attitudes/treatment provided and indeed the selection of HML to be their outsourced partner is based on much of this.

It is therefore in-turn, little known that the Skipton Building Society are the owners of HML.

Contact has been made with the Skipton but to date they have not acknowledged the communications sent. You might be right therefore to start publishing the 'behaviour attitudes' here.

It is not always top quality mortgages that are favoured to be securitised or for whole loan sales as many 'purchasers' (mostly prime/mainstream lenders) will ‘cherrypick’ well in advance of the typical mortgage criteria that they will assume responsibility for. This can be for many economical reasons particular to the purchaser’s financial aims and objectives. As such, this will not always be to prime, near prime but also to other more risky portfolio accounts.

I agree that in the real world you would expect the less risk the better but when the emphasis is on portfolio management of a small volume of accounts, it can also mean that equity stripping and thus a negligent attitude towards repossessions can be at the forefront of a buyers commercial and financial aims.

Portfolio performance and yield is important but there is a limited time period on these mortgages (3 years) to gain a high ROI as quickly as possible. It will be the good payers within the portfolio and of course the ad hoc interest rate increases to the mortgage portfolio borrowers that will pay for the fewer and very quick repossession actions taken, not withstanding, the borrower who is being repossessed (without being provided any assistance or even an 'ear' to listen) that also pays for the action (legal costs etc).