This page contains a Flash digital edition of a book.
FMNL6194 - Print advert for Mortgage Introducer_Layout 2 29/02/2012 14:55 News Review: Near Prime


Near prime gaining by


Alan Cleary, managing director, Precise


Mortgages


We are approaching 12 months since we launched into the near prime market so it feels like a good time to look at the progress made. Achiev- ing our volume targets has been a challenge because the near prime market had been effectively closed for the pre- vious three years and on top of that consumer confidence was and still is low. We com- missioned a YouGov poll last summer which highlighted that a significant percent- age of borrowers felt that they would not qualify for a mortgage and that banks just weren’t lending money. This perception is partly true but has been exagger- ated by a media hell bent on bank bashing. We decided that in order to get some momentum we would start a programme designed to help brokers educate their cus- tomers on the reality of the modern mortgage market. Hence “Prime Time for Near Prime” was launched. This started off with the YouGov poll which collected the views of 2,113 mortgage borrowers and helped us understand the borrowers’ needs and wants, leading us to alter some of our credit criteria to better fit with our target borrower. We also changed our process so that when brokers apply for a decision online we leave a soft foot print instead of a hard foot print. We published a number


www.mortgageintroducer.com


of printed brochures to help brokers explain to their cus- tomers that there were op- tions even if they did not have the perfect credit history and we made the rather odd de- cision to travel up and down the country in a red London bus promoting the virtues of mortgage brokers. The big question is wheth- er it worked and whether borrowers and brokers views have changed in relation to near prime mortgages.


“So far this year volumes have picked up considerably”


All I can say at this point is that quarter four last year and so far this year volumes have picked up considerably but there is still a long way to go. We need consumer confi- dence to settle down and we need more lenders to enter the space. At the moment there are fewer than a hand- ful of lenders actively promot- ing themselves in the near prime market and between us we represent a relatively small amount of lending. But the quality of the borrower is ex- ceptionally high and with loan to values in the 60% range, all with 100% income verification and strong affordability it is only a matter of time before the trickle of funding turns into a stream and then a river. Will this happen in 2012?


Undoubtedly not, but I be- lieve the journey has begun and the near prime market is set to become an important and fundamental sector of the UK housing market.


Distinctly different... Not all buy-to-let lenders are the same - at Paragon


Mortgages we are proud to stand out from the crowd.


That’s why when looking for a lender to satisfy the complicated financial needs of professional landlords, those in the know choose Paragon Mortgages. If it’s a limited company, an HMO, a multi-unit property or a customer who already owns a large portfolio, remember who to choose.


www.paragon-mortgages.co.uk 0845 849 4057


Buy-to-let for serious players MORTGAGE INTRODUCER MARCH 2012 13


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52