Brokers say that specialist mortgages can improve impaired credit profiles, according to Alliance & Leicester Mortgages.
Four in five brokers – 80 per cent – believe the sub-prime market will continue to grow in the next two years with 19 per cent thinking it could increase by more than 20 per cent.
A&L research has revealed that 86 per cent of brokers say sub-prime and near-prime mortgages help their clients get on the property ladder.
The research finds that near-prime and sub-prime mortgages are an effective way for people to repair a damaged credit profile.
It says 79 per cent of brokers say their clients are aware that an impaired credit history can cause them problems with getting a ‘prime’ mortgage and even more – 86 per cent – say their clients understand that a near-prime or sub-prime mortgage will enable them to get on the property ladder and help rebuild their credit profile.
Head of intermediary mortgages Mehrdad Yousefi says: “It comes as no surprise that brokers are seeing an increase in the number of near-prime and sub-prime cases they are dealing with. This market is becoming increasingly competitive with more lenders offering these specialised mortgages.
“It is encouraging to see that brokers say their clients know the value of these type of mortgages and that it is a good way of getting potential buyers on the housing ladder while enabling them to repair their credit history by maintaining regular payments on their financial commitments.”