Sub-prime mortgage lenders who give loans to people with bad credit records account for more than 70% of all repossessions, a BBC investigation has found. The market for high interest sub-prime mortgages has been booming and it now accounts for about 8% of the total UK mortgage market. This triggered the credit squeeze that resulted in a run on Britain’s Northern Rock bank. The FSA points out that in July it “reported the results of a review of mortgage lenders and brokers operating in the sub-prime market, which found weaknesses in responsible lending practices and in firms’ assessments of a consumer’s ability to afford a mortgage” and insists it is “paying particular attention to self-certification busines”. TOOLS & GUIDES Mortgage worries? read more

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