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‘Indemnity cover key to securing FTB loans’

Leading industry figures have agreed that mortgage indemnity insurance has a key role to play in persuading banks to lend to first-time buyers.

On Tuesday, housing minister Grant Shapps called a meeting of industry figures to discuss how to help first-time buyers get into the property market. The attendees included Council of Mortgage Lenders director general Michael Coogan, Building Societies Association head of mortgage policy Paul Broadhead, Genworth Financial president of mortgage insurance for Europe Angel Mas and FSA manager of credit risk Duncan Mackinnon.

Representatives from major housebuilders, insurers and consumer groups were also present.

Mas says: “We discussed MI, not as a compulsory requirement but how it could incentivise banks to lend to FTBs. In general, everybody agreed that MI has to play a role.”

An FSA spokeswoman says: “It is something that we recognise as a tool lenders can use.”

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