Guy de Jersey, managing director of LMG Logistics talks about the launch of its new service to help older homeowners extend leases with a lifetime mortgage, why the FCA should reintroduce the principle ‘Caveat emptor’ (‘Buyer beware’), and celebrating his 25th wedding anniversary in lockdown.
Tell us a bit about yourself and LMGL
I’m a born and bred London boy, I grew up in the capital in the 70s and 80s which was awesome. I left school at 16 and had a job cleaning flats for short holiday lets, which is where I first became aware of short and mid-term lease properties. After a spell living in France, I returned to London and set up as a residential developer. I quickly learnt about leasehold enfranchisement, otherwise known as the process for extending the lease of a house or flat, or purchasing the freehold.
I started buying properties with mid-term leases and going through the process of enfranchisement. It was not rocket science to realise that the people selling these flats were doing so out of necessity, because they were unable to afford to stay in their homes. Although they had valuable equity in their property, this diminished each year as the length of their lease ticked down, and they didn’t have the cash to enfranchise themselves.
This is where the idea for Lifetime Mortgage Gateway was born. We had had tried earlier concepts, which would not work in practice. Then the team at LMGL worked out a way for people such as this to buy a 90-year lease extension with a lifetime mortgage, a loan with a fixed rate for life, to stop the depreciation of their home and secure their asset.
What positives have you taken from the whole lockdown experience?
My wife and I celebrated our 25th wedding anniversary during lockdown. I asked the vicar if he would bless our marriage outside the church with our children watching. I also asked a few of our friends in the village if they might take their daily exercise and pass by the church at the same time.
Is there a book or podcast that is essential reading / listening for your industry?
Not yet, the book is still being written. What exists now is a genuine endeavour to make lifetime mortgages equitable and right for every individual who takes a loan. Enfranchisement is being reviewed but expectations are out of kilter with what can be delivered, equitably.
Who has single-handedly made your industry better?
Key are leaders in the field of later life lending, and we are proud to have them as partners. That said equity release is a business sector and everyone in it has a responsibility to get it right.
If you could give a younger version of yourself one piece of financial advice, what would it be?
It is better to make money with people than out of them.
What three things would you do if you were head of the FCA for the day?
First off, they do a pretty good job. I’d re-introduce the principle of ‘caveat emptor’ (‘Buyer beware’), so that consumers know that first and foremost they must carry out their own due diligence when buying any financial product. However, when a firm is guilty of fraud, custodial sentences should be sought for those who are ultimately responsible, such as senior execs. The FCA should also offer clearer advice or at least a point of view. Directing someone to an entry in the handbook, which is invariably abstruse or esoteric and can have multiple connotations, is no help at all to new businesses.
What is the one column or website that you read every day?
I occasionally read Money Saving Expert and I regularly listen to BBC Radio 4’s Today programme.
What would you do if you received a windfall of £10,000?
My family and friends have all been very supportive whilst we have been building LMGL, so I’d do something for them. But first and foremost, I’d treat my wife to something special.