View more on these topics

Affordability calculators lower arrears, says GMAC-RFC

Affordability calculators are helping to protect consumers from falling behind in their mortgage payments, according to GMAC-RFC.

The claim is made by GMAC-RFC in a speech published by the Social Market Foundation.

During his speech, Stephen Knight, executive chairman of GMAC-RFC, stated the old-fashioned method of manually checking income fails to determine real affordability and leaves consumers at greater risk of falling into arrears.

The average amount of sub-prime lending arrears after two months is 9%, according to a report by Fitch.

GMAC-RFC has revealed its figure is actually 5%, almost half the industry average.

Both GMAC-RFC and the Council of Mortgage Lenders report 0.4% of prime lenders to be in serious arrears.

The figures were first made available at a GMAC-RFC-sponsored debate on responsible lending held by the SMF.

The event was chaired by John McFall MP, chairman of the Treasury Select Committee.

Fiona Price, director of cross market interventions at the Department of Trade and Industry and Peter Tutton, social policy officer at the Citizens Advice Bureau also spoke at the event.

Knight says: Lenders have a duty to treat their customers fairly but many simply do not understand the impact antiquated underwriting systems have on arrears.


Electronic integration

Finance & Mortgage Solutions says its operations are now fully integrated with Trigold’s E-Trading Centre. Following this development, advisers will be able to send applications electronically to over 50 lenders.

US sub-prime giant is brought low

The New York Stock Exchange delisted ailing mortgage giant New Century Financial Corporation, the second largest funder of sub-prime loans in the US, last week.

Brokers say no to government-funded eco-deals

Just over half of Mortgage Strategy Online readers say the government should not partially fund green mortgages. Meanwhile, 44% of intermediaries think that government-funded green mortgages are a good idea.

Demand outstrips supply, says Hamptons

Latest analysis from Hamptons International, has found that there is an average of eight buyers for every seller. Hamptons says this imbalance in supply and demand is showing no sign of abating as the spring market moves closer, with many sellers holding back from putting their property on the market until a suitable property becomes […]

Why we all need to back the housing underdog

The UK loves an underdog. There is something irresistible about the story of the little guy standing up to the established players and leaving them with a bloody nose, whether it is Henry Cooper putting Muhammad Ali on the mat or the Wallabies trouncing the Kiwis in rugby. At the Conservative Party conference, LendInvest championed […]


News and expert analysis straight to your inbox

Sign up