‘I certainly believe the mortgage market has shown its resilience’

Despite having worked in finance for more than 35 years, the mortgage market still has the capacity to surprise even the director of mortgages at UK Finance, Charles Roe.

“One of the things I would say, in terms of the mortgage market, is that you think you’ve seen everything, and then something else will come along that we’ve not seen before.”

Besides a pandemic that introduced furlough and blanket payment deferrals, and a financial crisis that saw house prices fall and repossessions rise, Roe recalls self-certified mortgages that would be unimaginable today.

“In this day and age you would think, what would possess anybody to grant a loan to somebody on a self-certified mortgage? ‘I can’t provide you with a payslip, but I promise you I’m earning £180,000 a year.’

“It doesn’t make sense. When you look back now, you think, how did that happen?”

They used to call it ‘jingle mail’. In the morning, the bank would get a number of envelopes with just keys put in there

Among 15 priority areas that include sustainability and cladding, Roe – who leads UK Finance’s mortgage policy development – says the biggest area in which the trade body is currently involved is working with its membership of 150 lenders to support borrowers during the cost of living crisis.

While today lenders have various support packages that can be tailored to borrowers' circumstances, Roe describes how the situation was very different 40 years ago.

“Going back to the 80s and 90s, when there was a house price crash, lenders didn’t have the support, the infrastructure in place, to be able to help those homeowners. 

“And what people used to do, they used to call it ‘jingle mail’. In the morning, the bank would get a number of envelopes with just keys put in there, with people saying ‘please take my property back, I can’t afford it anymore’.

“We’ve evolved, we’ve developed over time. So these things, they’re unique and so I think as they say, if it doesn’t kill you, it makes you stronger. And I certainly believe in terms of the mortgage market, it has shown its resilience.”

Indeed, the trade body recently responded to the FCA’s draft guidance for lenders on supporting borrowers impacted by the rising cost of living, says Roe, who held five different roles while he worked at the regulator.

“The FCA is a unique organisation to work for. It gives you a real insight into firms, business models [and] the different challenges the regulator faces, in terms of where it can divert its limited resource to.