Loans Getting Harder To Find
It is becoming harder to find a suitable mortgage deal or home loan and those deals which are available are becoming more expensive for borrowers, according to a new report from the Intermediary Mortgage Lenders Association (IMLA), the trade organisation which represents independent mortgage brokers and intermediaries in the UK.
The report showed that nearly two out of three brokers have not been able to source a suitable home loan for a borrower in the sub-prime sector and just over half have failed to obtain a loan for someone even in the prime sector with no bad credit history, despite the fact that they have the whole of the mortgage market to choose from.
Of those interviewed in the survey, 92 per cent of brokers said that it was more difficult to source a new loan for a client due to much tighter lending criteria from providers and that 94 per cent of borrowers were now paying more for their new loan than they were previously. It is even more difficult to arrange a mortgage or bad credit loan for a borrower in the sub-prime sector, with only 34 per cent of brokers saying that they had always managed to source a deal for such clients.
Peter Williams from the IMLA said that borrowers were experiencing difficulty in obtaining a new home loan, particularly if they tried to do all the work themselves. He added “They need good advice and all the help they can get just to source a loan. The role of the intermediary has never been more important.”
Following the credit crunch Lenders have withdrawn many of their loan and mortgage products due to more restrictive lending criteria, in total the number of available mortgage deals to choose from has shrunk by approximately 76 per cent in the past twelve months alone. Many experts are calling for the Government to step in to ease the liquidity situation for lenders in order to try and re-start the UK housing market.
