HOME buyers are seeking reassurance after another week of financial shake-ups. Lloyds TSB this week announced details of a £12.2bn takeover of HBOS, creating a new UK banking giant.
However, uncertainty now surrounds the impact that this will have on an already struggling UK mortgage market, the new group being in control of almost a third of it.
The Government had to waive competition rules to secure the transaction. And the main UK financial sector regulator, the Financial Services Authority – which would normally have been opposed to the creation of such a dominant player – encouraged the takeover.
Craig Armstrong, an independent adviser at Gordon Brown Associates, advised home buyers to strike now for a good mortgage deal.
He said: “I think that they will have a little bit too much control over the mortgage market to be healthy.
“But at the moment there are some excellent mortgage products still available, with the likes of Nationwide, Halifax and Abbey included. My advice would be to speak to someone who has access to the whole market and who can comment on the intricacies of each mortgage deal.”
Newcastle independent financial adviser David Heppell, of Dhanda Financial, thinks the Lloyds TSB/HBOS move could help bring stability but hopes home buyers will not be exploited.
He said: “What would have happened if Lloyds TSB hadn’t had the funds to take them over? Would we have had another Northern Rock situation?
“They certainly will have more influence over the mortgage market but I would hope that there would be mechanisms put in place to stop Lloyds TSB exploiting its new position.”
North East builders Miller Homes wanted to reassure home buyers, offering support to those currently looking for a mortgage.
Debbie Dunthorne, sales director of Miller Homes North East, said: “Several builders have schemes to help buyers. For example, our MiWay scheme enables first-time buyers to access some of the best mortgage deals on offer at the moment, along with the reassurance that we are partly covering them in the event of falling house prices.”
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