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‘Be transparent on sub-prime exposure’

Alliance & Leicester head of specialist lending Jeremy Claridge says lenders must be more open about their exposure to the US sub-prime crisis.

Claridge says the market is spooked because lenders have not been open enough.

A&L increased pricing on its near-prime and credit-adverse range by 0.75 per cent last week and Claridge says it will not rule out further rises. The lender sells its loans on completion to Lehman Brothers.

Claridge says: “It is 80-20 that we will have to move rates again but our lending criteria are fairly conservative so the type of collateral that we are originating is relatively clean and we will not have to increase as far as others in the market.”

Northern Rock, which has a similar arrangement with Lehmans, has increased sub-prime fixed rates by as much as 1.25 per cent. The move saw it withdraw all its sub-prime tracker products until further notice and reduce proc fees on niche prime and light-adverse products to 0.75 per cent.


BDMs could be unsettled in securitisation crisis

Top business development managers at mortgage securitisation lenders will be “sitting targets” for balance-sheet lenders if the current market conditions continue, says John Charcol senior technical manager Ray Boulger.He warns that many securitisation lenders are increasing rates and changing criteria to deter business after the fallout from the US sub-prime crash and their business development […]

Give and take

One of the changes under the new Chancellor has been to announce the bringing forward of the pre-Budget report to October. In the last few years, it has been in early December.

Complex policies blamed for slump in IP sales

Income protection needs a complete overhaul to reverse falling sales, says Defaqto.Its report, Income Protection Insurance 2007 – A Time For Action Not Words, says insurers must simplify their products to close the estimated £175m income protection gap.Defaqto says different ways of treating occupations and inconsistency in applying benefit limitations are stifling the product because […]


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