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Britain facing “interest-only crisis”: Kensington

Over 250,000 homeowners are expected to struggle to refinance their properties over the next five years, according to research conducted by Kensington.

The data shows that 15 per cent of British borrowers will have reached the end of their repayment date by 2024 and will be unable to find a new deal, which Kensington says is due lenders taking a more stringent stance on risk.

In addition, shifting to a conventional repayment mortgage will be difficult for these borrowers, as many will be nearing retirement, according to the specialist lender.

By the beginning of 2029, the building society predicts that 860,000 interest-only mortgage borrowers will have reached the end of their terms, with half of those borrowers unable to find a new deal.

Kensington Mortgages chief executive Mark Arnold comments: “This is a big problem that is lurking in Britain’s financial system. It is important that people start thinking about this issue now, before thousands of homeowners find themselves facing a giant repayment bill.

“Society has changed a great deal in recent years. Yet the big banks, driven by risk considerations, now lend to fewer and fewer people.

“The people who will be facing these bills will have a very different customer profile at the expiry of their mortgage than they did 25 years earlier when they took out these products – many will have retired.

“Of those who are still working, many are likely now to be self-employed. Some may have moved from full-time work into the gig economy.

“They could still be fantastic borrowers, but these are families that will not necessarily be able to tick all the boxes when they come to ask one of the big banks for a new loan.”


Kensington director of sales and distribution steps down

Kensington Mortgages director of sales and distribution Steve Griffiths has stepped down after 18 years at the firm. Griffiths, who won the ‘Business Leader of the Year’ at the 2018 British Specialist Lending Awards, according to Kensington, will have his last day on 31 March 2019. Kensington Mortgages new business director Craig McKinlay comments: “We […]


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