Half year results from the Alliance and Leicester have shown profits at just GBP2 million, down from GBP290 million for the same time last year.
The biggest reason for this massive fall is the writedown of assets that the Alliance and Leicester carried out. This was done because of the worldwide credit crunch that has sent their asset values fall. The good news is that the market had been pre-warned about the write down so, even though it was a little more than was expected, industry experts were not too surprised.
Although investments have proved a difficult area for the Alliance and Leicester their mortgage business appears to be stable as do both personal and business banking. Numbers of mortgages provided are down but the quality is still good meaning bad debts are unlikely to cut into the bottom line.
Legal and General has brought a new tracker mortgage to the market, with a maximum loan to value of 75 percent.
The mortgage does have a GBP999 arrangement fee, though this can be added to the mortgage value. There is also an offset facility at no extra charge and, for those looking for a remortgage there is a separate package or a cash return. In a quiet mortgage market Legal and General hope that this particular approach will generate considerable interest.
A spokesman from the company said that this particular tracker mortgage option would be perfect for someone with equity in their property and a balance of money that could be offset against the home loan. Legal and General are happy to answer any queries regarding the tracker mortgage, inviting people to get in touch either on line, by phone or at their local branch.
After being unable to maintain the repayments on her GBP360,000 Northern Rock mortgage Christina Georgiou and her three children have been given just a month to vacate the property they once called home.
There are anticipated to be many thousands of people just like Ms Georgiou who have fallen behind on their mortgage repayments but the irony of Northern rock, effectively a government backed financial institution, throwing people out of their home is sure to stir up controversy.
A particularly relevant fact of this situation is that the Northern Rock lent the money not really knowing if the repayments were affordable. This is much like many other banks and building societies which will strike a sombre note for many observers who may now be expecting this scenario repeated across the country.