Brokers highlight mortgage plight

The Intermediary Mortgage Lender's Association's latest survey shows just how tough it has become for borrowers in the current climate, with 70% of respondents reporting that their ability to source a loan is getting worse.

Almost a fifth said there was no change, while a very small 2% reported that they are finding it easier to get a mortgage on behalf of their clients.

Not surprisingly, it is harder to arrange a mortgage for non-prime customers than for standard-status ones. While 45% of brokers reported they have always managed to find a loan for standard status customers, the figure dropped below 34% for sub-prime.

On average, so far this year each broker had 13 clients for whom they were unable to source a loan, with little variation among the different geographic regions of the country. In most cases, they were unable to source a mortgage for a small number of customers (five or fewer), but 12% of them reported being unable to arrange a loan for 11 or more standard status borrowers; for 8% of them, the number of cases exceeded 20.

IMLA’s executive director Peter Williams said: “We all know this is probably the most difficult market we have seen for a generation. The survey helps us to quantify the extent of the problem and the experiences of brokers in helping their customers to find a suitable loan.

“Seven out of 10 of them report it is more difficult to source a loan, with borrowers with a poor credit history more tricky than standard status. Well over 90% of them report that borrowers are paying more and facing stricter underwriting criteria.

“In this difficult market environment, customers are struggling to find a loan either direct from a lender or via an intermediary. They need good advice and all the help they can get just to source a loan. The role of the intermediary has never been more important.”