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They say turning 30 is traumatic but having now notched up 30 years in the mortgage industry, I can say that so much has changed in that time that it has been a consistently rewarding career to be in. It is certainly never dull. When I started my career at Abbey National in 1978, the lending landscape was a bit different to now, to say the least.

The old joke back then was "How do you approach a bank manager for a mortgage? On your knees."

While the market is vastly superior to the 1970s and 1980s, it has almost come full circle and given the current funding difficulties and tight lending restrictions, you could probably tell the same joke today.

So what was it like back then? Mortgage products used to come in three types: repayment, endowment or option mortgages.

There were no trackers, offsets, capped rates, discounts or any mixture of the above. There were no such things as overpayments, payment holidays or cash backs. There were certainly no 100 per cent mortgages and no lender ever gave away air miles, cars, televisions or any other incentives. Procuration fees were unheard of.

There was one interest rate for everyone and every building society offered the same rate, which was decided by the Building Societies Association at a monthly meeting.

At the time, the Bank of England base rate was 9 per cent compared with the 5 per cent we have now.

We used to lend up to 95 per cent of a property's value but mortgage indemnity guarantees were used by every lender and were charged on the proportion of the loan greater than 70 per cent or 75 per cent of the property value.

We are currently benefiting from lower interest rates than the late 1970s, and while many borrowers are starting to feel the pinch from higher rates this year, I bet they would feel a lot worse if they had to pay 9 per cent.

House prices have increased enormously, I bought my first flat in North London for £21,000 and having asked local valuers, I have found it is now worth just a shade less than £200,000.

Back in the 1970s, the concept of shopping around between lenders had not really been invented and the balance of power rested firmly with the building societies.

Customers tended to get mortgages from the institution they had a savings account with because in the days before credit scoring, they had to demonstrate a track record of being able to put money aside and manage their finances well.

Lending decisions were made locally, normally at branch level, and we would always write for references, for example to the customer's landlord and their employer.

In some cases we would contact their bank or accountant. Applications were then sent to head office to be approved. In some of the smaller building societies, every single mortgage had to be approved by the board.

All banks and building societies had strict quotas on lending and therefore, having interviewed half a dozen potential borrowers throughout the week, we would decide which two or three would be lucky enough to get a mortgage.

Those that did not make the grade would sometimes be put on a waiting list. Borrowing was pretty firmly driven by income multiples, with very little local discretion. Example multiples would have been two-and-a-half times the first income plus one times the second for joint applications or two-and-three-quarters times income for singles.

Compared with today's sophisticated credit-scoring systems, centralised risk-management by large lenders and products that vary subject to status, it all seems a bit crude. In spite of that, it worked very well. Certainly there were a smaller proportion of mortgages in arrears than there are today.

Mortgage interviews were shorter than they are today and there was certainly less paperwork. Mortgage surveys were more detailed and there was no such thing as drive-by valuations or automated valuation models.

Mortgages were really seen as a privilege rather than a right. Some would say that this is the way the market is heading again. In many respects, this market correction is inevitable and should not come as a surprise.

The adviser market was pretty much non-existent back then. While we did occasionally get applications referred to us from local estate agencies or bank managers (as most banks did not bother with lowly mortgages due to the credit controls imposed by central government), this was the exception rather than the norm.

Competition has changed the market dramatically since then. Margins have been squeezed to such an extent that associated fees had to pop up to replace lost revenue. Since the start of this year, however, lenders have taken the opportunity to rebuild some of their margins at the same time as regulate the flow of new business.

Since 2000, lenders have literally been falling over themselves to lend on property with fierce rate wars, more relaxed credit standards and incentives. But how fast things can change, the days of the 125 per cent loan-to-value mortgage are now gone and we might never see their kind again.

Interestingly, the second-charge market was alive and well at the beginning of my career and it was not uncommon for a customer to borrow against their life policy or to take out a secured personal loan if they wanted to top up their mortgage. They would get, say, 90 per cent from the building society and the remaining 5 per cent from an insurance company.

The location of a property has always been very important to lenders. But back in 1978, for some lenders certain areas of London, where I was based, and other major cities, were effectively off limits because they were judged to be in decline.

This was called red-lining – literally drawing a red line around certain suburbs that we were not prepared to accept as security on a loan. Over time, these attitudes changed and many areas of London and other cities have benefited as a result.

Looking back, is the mortgage market in better shape now? Certainly, more people have fulfilled their dream of owning their own home, many have done quite well out of the property market and the quality and choice of products today is significantly better.

In saying that, there are lessons to be learnt from the past. There is something to be said for knowing, and I mean really knowing, your customers and for people saving hard to get what they want, showing they are serious about owning a home before they make that huge commitment.

Ultimately, the balance of power is much more healthily distributed between lenders and borrowers in the modern market. Present events have been moving so fast, who knows what will happen in the next 30 years?

Stephen Smith started as a management trainee with Abbey National Building Society in north London in August 1978. He has subsequently worked for the Mortgage Corporation, Homeloan Management and Legal & General Bank. He is now housing director of Legal & General, responsible for the mortgage, survey and estate agency businesses of the company.

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