Specialist lender GMAC is slashing rates across the board and offering over 1,300 different mortgages following an overhaul of its non-conforming product range.
In a move it says could spark a mortgage war in the sub-prime sector, GMAC is cutting rates on its product range by an average of 1 per cent and adopting a “pricing for individuals” approach to lending.
It now claims to offer over 70 per cent of the cheapest mortgages available in the non-conforming market.
It also claims to offer the most comprehensive product range after revamping the traditional lending policy of lumping borrowers into “catch-all” categories of bad credit where borrowers with a wide range of circumstances, such as a customer with one county court judgment will end up paying the same rate as, say, a borrower with several CCJs.
GMAC says its new pricing policy abolishes this type of cross-subsidy by offering loans for every variation of bad credit.
GMAC marketing director Simon Knight says: “The non-conforming sector requires a specialist approach to underwriting. This is something that has caught out at least a couple of other late entrants to the market as they have discovered that it takes a wholly different approach for these types of borrowers.”