This Year Has Seem Some Improvements To Remortgages And Secured Loans
This is getting near the end of another year and it is not coming to an end
, in the financial sector at least, in the way that many people had hoped and expected that it would.
We were still in the credit crunch at the start of 2010 and it has been difficult in the lending industry..
The recession initially was caused by the reckless lending of the banking sector in America, particularly as regards the solf certification of earnings of borrowers, both in the private and business sectors.
Lenders were prepared to lend loans, mortgages, etc. to almost anyone.
Many millions were lent particularly to so called property developers who were not even really business men and were often little more than crooks.
Obviously this kind of slack lending practices could not go on forever and something would have to give.
And something did give, and give with a vengeance, with the UK seeing the first ever totally government owned building society with the complete demise of the Northern Rock Building Society and no one will ever be able to forget the thousands of people queuing up to withdraw all their savings.
The collapse of this lender of loans, mortgages, remortgages, etc.. it was to be expected as they lent recklessly. at 25% more than the property is worth.
Many mortgage lenders ceased trading, and the number of deals available were about half what they had been before.
The number of homeowner loan lenders in the UK went from twenty five to only five, and the underwriting criteria was very restricted with 90%, 95%, 100% ,and even 125% loan to equity plans totally abolished.
Self declarations of earnings, for both self employed and employed applicants, ceased to exist, and for a time it was extremely difficult for the self employed to obtain any form of loan at all..
During the course of the current year matters have improved a little, although not as much as expected, and lenders and brokers are still struggling badly with their customers thin on the ground.
The main improvements seen are that Link Loans returned to the secured loan sector and introduced a self employed loan plan for those only in business for six months at a 60% LTV, and applicants must also provide three months bank statements.
For some time now, the maximum LTV for employed borrowers was 85% and 75% for the self employed
However since last week, we have seen a new lender prepared to advance secured loans at up to 90%, but the biggest loan is only self employed cannot apply for these secured loans and the maximum advance is only 15,000..
None the less, these are still improvements at the end of yet a very difficult year, and those employed in the finance industry are hoping for many other improvements next year.
by: Liz Moir
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