Kensington has confirmed it will be adjusting its sub-prime criteria from Friday as revealed by Money Marketing online last week.
The lender will be increasing fixed-rates on all near prime, near prime max, very low 90 per cent LTV products by 0.5 per cent but says that there will be no changes to its near-prime products sub-90 per cent LTV.
All medium, heavy, high products will also increase by 0.5 per cent but it will be increasing rates by as much as 1.5 per cent on its medium products with 85 per cent LTV and heavy 80 per cent LTV products.
It has capped LTV at 85 per cent – previously 90 per cent – for medium adverse business, 80 per cent – previously 85 per cent – for heavy business and 75 per cent – previously 85 per cent – for high adverse business.
In an email to packagers, Kensington says: “Given current global capital market volatility, the cost of fundingadverse credit mortgages is changing daily, as is investor appetite for mortgage portfolios which include high LTV, high adversity loans.”
Director of marketing Ian Giles says: “As you might expect from an experienced lender like Kensington, we will continue to review our pricing and criteria whilst the global capital markets remain in their current volatile state. We will communicate any necessary changes at the first opportunity to ensure that our actions remain transparent and easy to understand. We will also be looking out for the key signals of market recovery and ensure that Kensington products remain competitive in a changing market.”
The current rates and criteria will be available until close of business
on September 6, with changes coming into effect on September 7.
Kensington says it still offers day 1 self-cert, no higher lending charge on any product and no ERC over hangs.