Over 20% of sub-prime cases can’t be placed says RAMP

John Rice, managing director of the Regulatory Alliance of Mortgage Packagers says it is unable to place around 20-25% of sub-prime cases, as lenders struggle to stay in the market.

He says: “We find that brokers in prime land are relatively untouched, however, in sub-prime land a massive amount of cases just can’t be placed when they could six months ago. We think between 20-25% of cases just can’t be placed at all now in the market, that’s many billions of pounds worth of business, you have frustrated clients and frustrated brokers, who are sending multiple applications to packagers to try and get the case place, but much of the time it just can’t be done.”

Rice’s views come as Moneynet.co.uk releases figures today
showing that vast numbers of UK borrowers have borrowed themselves into a position of vulnerability in order to buy property and are not in a position to remortgage.

Nearly 35% of respondents to its recent survey are juggling a mortgage debt more than three times their gross annual salary.

The website says that of these, nearly 30% are unsure
whether they would be able to provide proof of their income to a new lender. Both factors seriously weaken their ability to secure affordable loans in the future.

Richard Brown, chief executive of Moneynet.co.uk, says: “Many of these borrowers are likely to find it very difficult to remortgage now that the days of easy borrowing have come to an abrupt end.
“Fewer and fewer lenders will be prepared to offer competitive alternative deals to anyone who is considered at risk of default. These borrowers will have little choice but to accept what their present lender is prepared to offer when their current deal comes to an end.”