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Intermediary lending down but not out, despite pressure

Intermediary lending is holding up despite the continuing pressure on overall lending volumes, according to the Intermediary Mortgage Lenders Association.

The latest Financial Services Authority figures show intermediary lending market share to have fallen 6% year-on-year. But brokers still sell more than 60% of loans.

Peter Williams, executive director of IMLA, said: “In a restricted market in which some lenders have focused on branch distribution and others that were 100% intermediary-based have been forced to suspend lending, it’s not surprising that intermediaries are losing some market share.

“The good news is that the intermediary market is still the dominant distribution channel. Most lenders realise they need to support brokers. Customers need quality advice and choice, especially in a market where the number of mortgage products has dived 85% in a year.

He added: “Our members are keen to work with brokers to maintain the sector. Mortgage advisers still have an vital role to play and lenders will continue to offer competitive deals via this channel.”


Choice in a shrinking market

The UK mortgage market has shrunk considerably in the past year. September saw just 33,000 mortgage approvals – dwindling near historic lows. Gross lending is estimated at £260bn for 2008 – around £100bn less than 2007 – and net lending for the year seems set to reach just £50bn, while 2009 looks bleaker still.

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