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Brokers criticise A&L loan stance on London and SE

Alliance & Leicester&#39s announcement last week that it is to take a cautious approach to lending in London and the South-east has had a mixed response from brokers.

A&L says it has ruled out lending over 90 per cent on properties between £150,000 and £350,000 or more than 75 per cent on a house worth over £350,000 in London and the South-east because of concerns over falling house prices.

The move has been criticised by many brokers who claim they will no longer recommend A&L to clients in London and the South-east.

NatWest and RBS have operated a similar policy but withdrew it last year. Their lending criteria are now applicable nationwide.

London & Country mortgage expert David Hollingworth says: “It is up to the lender to assess risk but first-time buyers are crying out for products over 90 per cent. Perhaps as the market stabilises, A&L will withdraw these restrictions.”

Charcol senior technical manager Ray Boulger says: “A&L are out on a bit of a limb here but each lender has its own policy. We would not recommend them for over 90 per cent loan to value anyway as they charge for a mortgage indemnity guarantee.”

Mortgageforce managing director Rob Clifford says: “This is a shrewd move and makes sense for the lender but can be irritating for brokers who have to get to know different lending criteria for different parts of the country.”

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