AToM urges lenders to ditch cautious approach

All Types of Mortgages has called on lenders to ditch their cautious approach and offer more competitive products in a bid to boost confidence in the market.

It says the total number of mortgage products available to borrowers has dropped by almost 50% since July last year, and since November 2007, almost a third of prime mortgage lenders offering mortgages at 100% LTV or more have withdrawn products.

AToM claims several balance sheet lenders are now experiencing capital solvency ratios far higher than the Financial Services Authority’s minimum requirement.

The distributor believes that if more options are made available to borrowers, there will be a rise in both consumer and investor confidence, leading to increased investment in the mortgage market.

Vic Jannels, chairman of AToM; says: “Many of the current rates offered by balance sheet lenders are acting as a deterrent to borrowers, as they are simply unaffordable.”

He says a rise in the amount of competitive mortgage products offered by balance sheet lenders would only have a positive effect.

Jannels adds: “If there is a rise in confidence, we may see the number of securitised portfolios being purchased by investors increasing. This will ease the pressure on securitised lenders and generate more competitive rates for borrowers.

“Unless, of course, the balance sheet lenders are holding out for something a little more sinister. The total demise of the securitised lending sector, surely not?”