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First UK victims shut by sub-prime crisis

Three UK mortgage firms are closing as the fallout from the US sub-prime crash spreads.

Victoria Mortgages went into administration this week after being unable to secure funding lines.

Lehman Brothers is closing its London Mortgage Company and Southern Pacific Personal Loans brands and withdrawing from the second-charge sector.

Victoria Mortgages blames disruption in the capital markets for its closure and says it will be unable to complete outstanding offers. The FSA believes that up to 380 customers will be affected although GMAC-RFC has offered to step in to help.

Victoria initially withdrew its sub-prime products at the start of August, claiming it was temporary and it would reprice its products by as much as 2.5 per cent when it relaunched.

Lehman says it will focus on its Southern Pacific Mortgage Limited and Preferred brands. It will look to consolidate some of LMC’s features and its salesforce into the two firms.

The company is undergoing a global restructure that will see 850 job losses, with around 100 redundancies in the UK.

Personal Touch Financial Services sales director Dev Malle says conditions are turning speculation about consolidation into reality. He says: “We have got players being driven to the wall and are going to see more. Unless they have a multi-product range or are a big established name, lenders are going to be forced into a corner. It is going to accelerate consolidation and this will not just be limited to lenders but will also affect brokers and packagers.”


Thinc buys Kent adviser to extend regional reach

Thinc Group has bought Maidstone IFA Cameron Scott in a move aimed at bolstering its presence in the South-east.Cameron Scott’s 18 advisers will continue to work out of their current offices as part of Thinc’s drive to open more regional offices.Chief executive John Simmonds says the acquisition also reflects its developing group strategy of attracting […]

Marr says RDR fails to address key issues

The retail distribution review is doing nothing to address the problems of millions of people in poor-performing closed funds or those getting poor annuity rates or the widening protection gap, says The Red House director Gareth Marr.Speaking at Osney Media’s financial services distribution summit in London last week, Marr also attacked proposals for customer-agreed remuneration. […]

Pos Sol conference: 112 Pos Sol partners take advantage of retention scheme

Positive Solutions announced today that 112 partners are expected to take advantage of the firm’s 0 per cent retention scheme introduced last year.The national IFA is ready to pay out £7m to the 112 IFAs giving them 100 per cent of their earnings. The IFA partners must write over £150,000 of business in order to […]

Shock treatment

There is good news and bad news for the housing market. The good news is that – for the time being at least – it looks as though interest rates are not going to climb any higher although, admittedly, rates could still go up if the liquidity crisis continues and the rate at which banks borrow money remains high. The bad news is that, despite the good news, affordability has reached new lows.


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