Banks relax mortgage loan rules

People who have a poor credit history or are self employed are finding it easier to borrow money to buy a home, market analyst Datamonitor has said and banks are increasingly willing to relax their rules because the mainstream market is saturated.

Lending to people who work for themselves or have trouble with credit ratings is set to continue to grow, and not just in the mortgage sector. The number of credit cards issued to the self employed or those with a poor credit history is set to rise from 9.5m to 13m by 2009, the group forecast. "The increased saturation of mainstream markets, whether credit cards or mortgages, has led to a number of mainstream lenders operating in the non-standard segment. Says the report.

"Consequently, the non-standard sector is set to become very competitive in the near future."

Problems have been emerging, however, and in recent months several High Street banks have warned that levels of bad debt are on the increase. Responsible lending and good finacial advice is still the key to success in this sector.

Author: John Wilinson

People who have a poor credit history or are self employed are finding it easier to borrow money to buy a home

Published on 17/4/2006.

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Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.

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