Alan Margolis, head of bridging at United Trust Bank, said that he was particularly pleased that the FSA would permit interest only loans where borrowers would not service the monthly interest payments.
UTB also believed that a key factor in the MMR’s flexibility was a result of the dialogue over the past couple of years between the FSA and the Association of Short Term Lenders, a trade body representing bridging lender.
Margolis said: “By permitting interest only loans where borrowers do not have to evidence affordability the FSA has acknowledged that within the broader pantheon of mortgages there are people whose requirements are not met by mainstream mortgage products.
“The flexibility provided by the MMR to lenders in such cases is tremendously good news and a move away from the one size fits all approach that characterised the approach to the mortgage market in the past.
“The bridging sector has shown that it is possible to be both simultaneously creative and responsible in designing products that meet niche demands.
“Our bridging loans are tailored to the specific demands and circumstances of our customers and the MMR will allow us to continue to meet the need for such loans.”
