Victoria Mortgages raise rates

17/08/2007

Victoria Mortgages, towards the start of the month withdrew all of its sub-prime mortgage products to elevate its rates by 2.5 per cent. This is known to be the highest increase by a UK lender since the capital markets bowed.

On 3rd August the lender decided to withdraw parts of its products, and were not looking to introduce their new products until the start of September. This shows us that the lender has left the market for one whole month.

On the other hand, Mortgages Plc is raising its fixed rates by 1 per cent, leaving Edeus to increase its interest rates up by a standard 0.35 per cent.

Hilgren commented: “The market is effectively closed at the moment. We are pricing our products where we know we can get the products off comfortably and get a good return when we securitise them. Other lenders are pricing up bit by bit and hoping they find the right level. We would prefer to price at the right level, and then bring the rates down when the capital markets pull through.”

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