Specialist Loans Could Soon Be Back On The Market
Prior to the credit crunch it was relatively easy for anyone to obtain the loan they required, particularly if this was a home owner loan or secured loan. Even someone with a poor credit rating, with previous loan arrears or even County Court Judgements (CCJ’s) could get the loan they needed, even if it was at higher interest rates.
But over the past couple of years or so, this area of business has dried up completely as banks and building societies have become extremely risk averse when it comes to offering loans, particularly in the area of non conforming borrowers.
But as the UK exits recession and confidence starts to slowly return to the loan industry as a whole, one or two lenders who previously specialised in the non conforming loan market, are now considering returning to this lucrative area of business.
Last week, Kensington mortgages announced that they would consider offering a loan to customers with CCJ’s or loan arrears and defaults, depending on the circumstances. Although Kensington have also said that this statement does not necessarily mean a full return to offering adverse credit loans, many experts feel that this is now inevitable.
Julian Wells of Marketing Innovation Forum said “Nature abhors a vacuum and product developers like nothing more than innovating to fill gaps. The recession will leave people with impaired credit records for years to come, just like it did in the 90’s, but with the recovery many of those same people are getting back on their feet and will be eager to own their own homes again or remortgage.”
“It’s great there are now more diverse product sets available, but many are niche areas and the traditional specialist market is not being serviced. It seems inevitable that it will return and who’s to say that Kensington’s move won’t prove the catalyst for other developments in 2010.”
