Sub-prime lending has fallen away, says Paragon Mortgages

Date:Wednesday 21st July 2010
Author: Susanna Kavka

Paragon Mortgages has stressed how lenders have focused their funds on handing money to customer profiles that fit their 'prime' criteria.

Managing director of the firm John Heron noted that - ever since the credit crunch - sub-prime and self-cert mortgages have essentially disappeared from the market.

This has led to many consumers who do not fit the prime lending profile being unable to get on to the property ladder.

"It is not surprising that the level of both self-cert and sub-prime business going through brokers has declined over this period because lenders simply aren't making the products available," he explained.

The Paragon Mortgages representative described how this has led to added demand in the rental market, which could potentially cause excessive inflation in this sector.

This week, chief executive of the firm Nigel Terrington stated that tenant demand has increased consistently over the past two years and "shows no sign of slowing down".