Why England - and the MMR - are not rubbish

Journalists like to write about what moves us. Having endured another exquisitely torturous evening in a packed London pub watching England labour to a second honorable defeat in what is likely to prove our latest ultimately futile campaign, the devoted football fan in me is out-emoting the rational personal finance writer.

It has been a morning of recrimination: should we have shifted the impressive Sterling to accommodate the mercurial talent of Rooney; should Lambert have been given more minutes to justify his selection; why was Leighton Baines not dropped after his first-game shocker?

Speak to most England fans today, and through the fuggy hangover heads and bitter disappointment is an underlying sense of despair. England simply aren’t up it, the performance last night was rubbish, Hodgson’s selections and tactics have proven his predisposition to caution will limit his ability to move the team to the required level.

Italy are, or should be on past performance and inherent ability alone, one of the favourites for the tournament.

Most of which is, frankly, nonsense.

Italy are, or should be on past performance and inherent ability alone, one of the favourites for the tournament. Uruguay are the current holders of the South American equivalent of the European championships, besting Brazil and Argentina in the process, and reached the semi-finals of both last year’s Confederations Cup and the last World Cup. They also have one Louis Suarez, who is one of the finest footballers on the planet.

To lose in tight games against these teams is no disgrace. Further, to have been the better team for periods, despite being a young and experimental side, is encouraging for the future. While there are areas that can be improved, defeat is by no means necessarily a disaster.

And, as a colleague said this morning: we’re still actually in the tournament, which sort of means we’re better than current world champions and paragons of footballing virtue, Spain.

Where am I going with this? The Mortgage Market Review of course.

A tendency to categorise everything into black and white, ‘good’ and ‘bad, pervades personal finance as much as football punditry. The negative side of that binary is always the easiest retreat, too.

The RDR is terrible, the regulator is a malevolent force with a single-minded goal to destroy regulated advice, and now the MMR is going to prevent anyone buying a house. Ever. Or so some of the moribund commentary would have you believe.

By some accounts the new affordability rules ushered in under the new regulations have been taken up with gusto by apparently recalcitrant lenders, who have taken every opportunity to refuse to lend.

Bet £2 on the Grand National? You’re a potential gambling addict whose mortgage payments are always at risk of being frittered away on the next big race. Think you might one day have children? You’ll never be able to afford to procreate and keep a roof over your head at the same time. Denied and denied again.

We’ve heard this variously from disgruntled prospective buyers or frustrated brokers, but I’m not sure I - if you’ll pardon the pun - buy it.

Lenders are lending. Yes, the amount they are loaning out tapered off a little in the lead up to and subsequently since April - Bank of England data showed a third consecutive monthly fall to 62,918 for the month, while separate data showed the average first-time buyer loan-to-value ratio falling in May from 86 per cent to 85.3 per cent - but this is hardly evidence of the taps being shut off completely.

If the above contentions - both of which are drawn from real examples, by the way - were true, activity would have fallen off a cliff. Moreover, the rules were explicitly designed to achieve this end: risky lending was on the up and price inflation was out of control. The MMR may not be the last of the measures implemented to curb these pernicious trends.

From what I’ve heard, I suspect it is true that lenders are being stricter. But I also get the impression there are no universal rules - and beyond the mainstream lenders there is a second tier with the will and the wherewithal to step in.

If anything, this should increase the value in seeking advice from an independent broker - and more people doing that can only be a good thing both for the sector and, I believe, the prospective buyers themselves.

So come on, let’s have less of the negativity. Yes there have been some unfortunate (to say the least) unintended consequences of the new rules - and I’ve spoken out vociferously about some lender behaviour before - but we need a bit of perspective. It’s not the end of the world - MMR should still prove to be a net positive for the sector.

And England can still qualify from the group. No really, we can: come on Italy!