Sub-prime borrowers struggle to remortgage.
According to Moody’s latest Credit Insight report, a remortgage is proving very hard to achieve for a large percentage of sub-prime borrowers.
Around 25% of sub-prime mortgage-holders are finding it impossible to refinance and remortgage. Figures reveal that mortgage backed securities made between 2006 and 2007 hold the highest proportion of mortgage prisoners. Those who took on a deal at this time have not been able to benefit from house price increases because of a drop in property prices due to the UK credit crisis.
Moody's warn that those transactions with a large proportion of mortgage prisoners are likely to suffer high losses.
A 'mortgage prisoner' is a home-owner who is either in mortgage arrears with a loan to value ratio over 85%, or a home-owner who pays their mortgage but has an interest-only deal for a 100% loan to value. For those in the position Moody's warn a remortgage may be hard to achieve.
Independent broker Deal Direct understand the difficulties faced by mortgage prisoners who are looking to switch to a cheaper deal.
Our skilled advisers are dedicated to sourcing affordable remortgage products whose criteria you fit within.
If you are having difficulty remortgaging contact one of our impartial advisers today.
