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Sub-prime mortgages stopped


DB Mortgages have stopped its complete sub-prime product range from the market sector.  This is the first big indication of a credit crush in the UK market subsequent the deepening US sub-prime catastrophe.

Dudgeon explained it has broadcasted emails to packagers informing that there will be a re-launch on its sub-prime products during August. The lender is now dealing with near-prime mortgages and buy-to-let.

Senior technical manager John Charcol explained that the US market is certainly having a growing impact on backing the UK. “There’s no doubt that any lender who relies on securitisation is going to fine margins pressed even more tightly or they will start to price products more expensively. There’s no way that lenders like Edeus and GMAC will not be affected by this.”

A spokeswoman added: “National Guarantee represented a very small strategic investment for GMAC-RFC. Like many business to consumer lending models, National Guarantee was finding it difficult to generate leads cost effectively in volume to make the business viable and profitable.”

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