Thomas Reeh, chief executive of blackandwhite.co.uk, said the lenders that lend on balance sheet and assess clients on individual credit risk could do extremely well, as other lenders let capital markets decide what makes a good risk.
He explained that lenders that had either restricted their criteria or exited the non-conforming market, such as db, Infinity and Unity, had shown a hand not fully committed to the sector or its customers.
Reeh said: “A vast number of customers are genuine people who have suffered catastrophic events and these people now have less choice. Any mortgage should be weighed up on individual credit.
In the next few months we’ll see which lenders will stick with brokers through thick and thin – a great opportunity for lenders here for the long term. There are new lenders that thought they could make a quick buck and many of those have high hurdles to meet for their investors. Capital markets change; you can’t just dip in and dip out as you like.”
Alex Hammond, PR manager for Kensington, said: “There is an element of truth in this, as the winners will be lenders that have been consistent throughout with their criteria and pricing, and have built sustainable, long-term models. There will be a flight to quality by investors investing in lenders with risk that is high performing. There’s a wobble now, but it will help sort those that are committed to the market.”
