Following the news that former MP George Freeman reportedly quit the role because he was unable to afford the rising repayments on his mortgage – despite his £118,000 salary – brokers have called out a lack of awareness of the realities facing mortgage borrowers.
In a move potentially designed to draw attention to the issue of staggering rate jumps, Freeman seemingly missed the mark, causing brokers to call out the logic on this week’s Mortgage News Live.
Bob Singh of Chess Mortgages, said that having worked out that Freeman’s salary was £6,000 net, and going from 1.5% to 4.5% on his mortgage would have taken him to £2,000 in repayments, he “might just have crap brokers.”
Katy Eatenton at Lifetime Wealth Management added that Freeman might also be over-indulging with his spending on the remaining £4,000 available to him per month.
Host Andrew Montlake, MD at Coreco, asked panelists if this story at least drew attention to the need for Government to step in and do more to help people facing rapidly rising payments.
Mike Staton, mortgage adviser at Staton Mortgages, noted that for his clients, going from £425 to £600 in payments would be much more of a jump, comparatively, leaving them in a far tougher position in terms of their finances than that faced by Freeman.
He said: “This smacks of how distant these politicians are from the public.”
Staton also noted that Freeman using mortgage repayments as an excuse for stepping down – presumably to take up an even higher paying position elsewhere – was counterproductive in terms of creating change for “Joe Public.”
He said: “George Freeman is in a position to campaign and get rates down, but rather selfishly, he has chosen to take a step back because it’s hitting him now. How about spending his time rallying to get these rates down, helping the public that have kept him in a job?”
Darryll Dhoffer at The Mortgage Geezer, added that those on the front bench were likely largely unaffected by interest rate rises, meaning there would be little impetus to help those who were.
The panel agreed that while the Mortgage Charter has helped, this was largely a case of “kicking the can down the road,” and more serious support was needed.
