Mortgages vanish as small lenders withdraw products

| March 27, 2008 | 0 Comments

The latest survey from financial website, Moneyfacts, shows that lenders are continue to withdraw mortgage deals as the credit crisis continues.

Over the past month, the number of mortgage products available across the UK’s residential and buy-to-let sectors has fallen by 2,026 to 5,700.

Moneyfacts notes that small lenders are now withdrawing mortgages, having previously been insulated from some of the problems of the credit squeeze by the fact that they rely on their deposits, rather than the wholesale money markets, to fund their lending.

However, building societies such as Bath BS and Tipton and Coseley BS, are either withdrawing products or restricting loans to direct business or local areas.

This is largely a reaction to increased demand as homebuyers search further afield because leading lenders are tightening criteria and increasing interest rates.

In the past month, Earl Shilton and Monmouthshire have both withdrawn products, while Mansfield BS has withdrawn its short-term discounted products.

Buckinghamshire BS has withdrawn its tracker rates, while Dunfermline BS has cancelled its 100%, 105% and 110% loan-to-value (LTV) range of mortgages, as well as two and five-year fixed deals.

Standard Life Bank is no longer offering two-year trackers, two-year fixes, or two and three-year professional rates.

It has also withdrawn the 95% LTV products within its three, five and ten-year range.

Meanwhile, Bristol & West has withdrawn all products for professionals and Manchester BS has reduced the LTV to a maximum 60% on selected trackers and fixed rates; Newbury BS is now restricting the maximum advance on discounts and trackers to £500,000.

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