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Bridging Loans

Divorce doesn’t have to end in tears with UK Property Finance

When a relationship ceases it can be a terrible situation for all parties both emotionally and financially. An amicable discussion to split assets can often bring its own complications however thousands every year unfortunately experience this and January is statistically the highest month of the year for divorces and separations. Ironically the highest number enquiries for rental properties during each year occurs on boxing day which indicates some forward planning takes place.

Our client approached UK Property Finance for advice in purchasing a new property following the deterioration of her long standing marriage. This sensitive situation is sadly one that we have seen before and the team at UKPF are well trained in handling.

Having found a modern 2 bedroomed house within the locality of the current family residence, our client was quick to submit an offer and to avoid disappointment. Starting again at this stage of life required family assistance and our clients parents agreed to provide a sizeable deposit to enable the purchasing process to begin.  The task of finding the remaining funds was handed to UKPF.

The divorce proceeding had begun and were anticipated to be lengthy and not in line with our clients required timeframe. Fortunately our client’s ex-husband had agreed an amicable settlement in relation to the ex-family home and was allowing our client a larger share of the equity from the sale in return for a reduction in his monthly maintenance payments. The current property was valued by three estate agents and after choosing the most trusted, the property was marketed for sale.

The chosen lender used the new purchase property and the ex-marital home as security for the loan. Using both properties allowed our client access to the lowest interest rates in the market. The exit vehicle being used to repay the loan was to be the sale of the ex-marital home and the lender required a legally binding court order as proof of our clients equity share from the sale.  This enabled the loan to be taken solely in our client’s name which satisfied the requirements of our clients ex-partner. The court letter took 2 weeks to obtain however UKPF used this time to achieve an offer for our client subject to receipt of the required documentation.

The lender offered the best rate available as well as a £99 valuation fee as both security properties were of standard construction. Overall the process took 3 weeks to complete from initial conception and was a successful outcome for all involved and UK property finance were able to negotiate a bridging loan that was flexible and to the client’s needs.

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Gender Pay Gap in Finance: We Need to Work Together

It’s no secret that the gender pay gap remains an issue for almost every industry and sector in the United Kingdom. Nevertheless, evidence suggests some industries are performing far worse than others, as far as equal pay issues are concerned.

The worst offender of all being the financial service sector.

According to the results of a recent joint-study carried out by researchers at Queen Mary University of London and the University of Sussex, gender pay gap in the UK finance sector has showed little to no real signs of improvement over the past 10 years. Despite on-going pressures from within the sector and external forces, drastic measures may need to be taken to bring things under control.

Immediate and Substantial Changes Required

Despite moderate improvements to gender-related pay issues over the past decade, progress in the financial sector has been comparatively slow. What’s more, the study also found that female representation at executive levels throughout the industry remains far below the expected level as of 2019.

As a result, experts believe it may be in the interests of UK policymakers to target certain sectors more specifically, with appropriate legislation to tackle the issue. Should the sector be unable or unwilling to make the needed improvements internally, it may be necessary to enforce external measures.

The study noted that the gender pay discrepancy was most notable among the highest earners within the financial sector. At the lower end of the scale, the average gender pay gap from 2009 to 2017 was just under 14%. Right at the top of the pay table, the discrepancy reached almost 57% for the same time period.

On the whole, the researchers found that between 2009 and 2017, female workers in the financial sector earned on average 44% less than their male counterparts. Even when factoring in all additional variables including experience, expertise, specialist skills and so on, the study found that women continue to earn around 14% less than men in the financial service sector.

This, despite the fact that the nationwide campaign to tackle gender pay issues in the financial sector has now been underway for more than a decade.

Higher Pay, Bigger Pay Gap

Speaking on behalf of Queen Mary’s School of Business and Management, Professor of Employment Relations Geraldine Healy highlighted how the gender pay gap grows as the respective female employee climbs the ranks:

“Our analysis shows that, when all other factors such as education, experience and childcare responsibility are taken into consideration, women earning the highest wages in the sector are subject to more discrimination and this has decreased only very marginally since before the Credit Crunch,” she said.

“The irony is that the more successful and better paid the woman, the greater the penalty in pay she suffers compared to her male comparator. In addition, lower paid women have experienced year-on-year less pay than lower paid men with little change since the recession,”

“The sector continues to be seeped in discriminatory practices with respect to pay and unequal treatment favouring men and disincentivising women. The increasing intensity of working hours over the ten-year period has had a negative effect on the gender pay gap,”

“Financial services have undoubtedly introduced and promoted positive diversity initiatives but these have been undermined at a strategic and operational level including by discretionary bonuses and increasingly long working hours.”

Ms Healy also suggested that despite continuous reassurances from financial service providers committed to positive change, external pressures may be the only viable solution.

“Change is unlikely without external pressures, whether from the unions, women’s networks and pressure groups but ultimately by the state introducing more stringent statutory regulations, she said.”

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Could Corbyn Be Planning His Own Estate Agency?

It’s hard to think of a time in recent history where the face of British politics was such an unmitigated mess. May’s imminent departure is highly unlikely to serve as a catalyst for stability anytime soon. Understandably, there are many who blame the Tories squarely and exclusively with the vast majority of issues the UK is facing right now.

One of which being the Brexit saga – the other being the UK’s on-going housing crisis.

In the case of the latter, we’ve long-since entered an era where home ownership – even sensible rentals – are completely inaccessible for an entire generation. Things have been heading this way for a while, but a complete lack of decisive action on the part of the Conservatives has been cited as a key contributor.

The question being – is there anything that can be done to steer things in the right direction? Should Labour take control at the next (and now-inevitable general election), how will Jeremy Corbyn attempt to succeed where his predecessor failed?

A New State-Backed Estate Agency

It’s no secret that whispers in Westminster and even political promises are about as reliable as a plumber’s estimate. Nevertheless, there’s growing speculation that a Corbyn government could introduce the UK’s first ever state-backed national estate agency.

The idea was first mentioned a while back by Owen Jones in his Guardian column, though has popped up once or twice again in more recent discussions.

In his column, Owen Jones stated quite clearly that “Estate agents are justifiably bogeymen for Generation Rent: why not set up a national, state-backed estate agency that works on a not-for-profit basis purely to help tenants?”

The idea is that should a state-backed estate agency plan go ahead, it would effectively serve as an enormous non-profit letting service for tenants across the country. The obvious issue with for-profit estate agents is their tendency to focus more on making money than the best interests of their clients.

An admirable idea, but with two fundamental flaws, nonetheless. Along with the problem of funding and staffing the new nationwide agency, there’s the small matter of attracting landlords in sufficient numbers. 

Presumably, a state-backed estate agency operating purely for the benefit of tenants would be completely unwilling to accept extortionate monthly rental prices and OTT deposits. Strict rules would be imposed to ensure that the tenant gained access to a good deal at a fair price.

From the landlord’s perspective, this could simply amount to lost earnings. If they can just as easily advertise their property privately for a much higher price and under their own terms, that’s probably what they’ll do. Hence, the idea of a state-backed estate agency has been interpreted by most as wishful thinking.

Important acknowledgement of the problem, but an imperfect and unworkable solution nonetheless.

Disappearing Inventory

To be frank, if there’s one thing the government (Labour or Conservative) should be doing to combat the housing crisis, it’s to build, build and build some more. Right now, the UK remains stuck within a period of record-low housebuilding – the lowest levels recorded during peacetime. Labour has already pledged its commitment to imposing an inflation cap on rent rises, but this doesn’t solve the problem out there simply being too few properties available.

It could also be useful to authorise local authorities to impose their own controls over excessive rent prices, but this is yet to be considered (or even mentioned) in Westminster.

In the meantime, there’s no realistic quick-fix solution out there to the UK’s on-going housing crisis. Irrespective of who takes the torch from May, chances are things will only deteriorate further – at least until the seemingly endless Brexit fiasco reaches some kind of conclusion.

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