Prime lending continues to dominate the UK mortgage market, says the Intermediary Mortgage Lenders Association. Despite prevalent fears over sub-prime lending in the US and at home, IMLA says prime and self-cert residential lending remain the majority.
It says this applies to loans generated both via the intermediary sector and direct to consumer.
IMLA says it has collated estimates of 2007 mortgage volumes split between direct and intermediary business. Its research shows specialist lending represents 30% of all lending and that the intermediary sector handles more than 90% of specialist business.
Peter Williams, executive director of IMLA, says: “Specialist, intermediary lenders are often associated with sub-prime, buy-to-let and other forms of specialist lending. “But we mustn’t overlook the fact that significantly more prime business is handled through intermediaries than direct - £140bn for intermediaries compared with £115bn direct.” He adds: “Even so, non-conforming business does represent around 30% of the whole market and as much as 40% of intermediary business.”
Williams believes it is important to recognise that non-conforming lending is not all sub-prime.
IMLA’s research shows the market share of self-cert and sub-prime activity declined slightly last year, while equity release remained a very small proportion of the market at well under 1%.
The association says UK sub-prime lending represents 6% of the market, as opposed to 20% in the US. Williams adds: “Intermediaries handled in excess of £230 billion in 2007, according to our calculations.
“Even in a slower market, based on projections for the size of the market in 2008, they will still be looking at substantial levels of activity in the current year.”
It says this applies to loans generated both via the intermediary sector and direct to consumer.
IMLA says it has collated estimates of 2007 mortgage volumes split between direct and intermediary business. Its research shows specialist lending represents 30% of all lending and that the intermediary sector handles more than 90% of specialist business.
Peter Williams, executive director of IMLA, says: “Specialist, intermediary lenders are often associated with sub-prime, buy-to-let and other forms of specialist lending. “But we mustn’t overlook the fact that significantly more prime business is handled through intermediaries than direct - £140bn for intermediaries compared with £115bn direct.” He adds: “Even so, non-conforming business does represent around 30% of the whole market and as much as 40% of intermediary business.”
Williams believes it is important to recognise that non-conforming lending is not all sub-prime.
IMLA’s research shows the market share of self-cert and sub-prime activity declined slightly last year, while equity release remained a very small proportion of the market at well under 1%.
The association says UK sub-prime lending represents 6% of the market, as opposed to 20% in the US. Williams adds: “Intermediaries handled in excess of £230 billion in 2007, according to our calculations.
“Even in a slower market, based on projections for the size of the market in 2008, they will still be looking at substantial levels of activity in the current year.”
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