Mortgages Uncovered

Earlier today, Bradford & Bingley said that it had seen an increase in the number of customers struggling with their mortgage repayments, however, they also said the buy-to-let market was still doing well.

Before the Annual General Meeting (AGM), Steven Crawshaw, Chief Executive, said more customers had fallen into arrears over the last few weeks, and went on to add:

“We’ve certainly seen the sort of increase that we’d expect given the income strain that is out there. This is a general credit stress, rather than people losing their jobs. There’s a straightforward economic stress coming through the books”

Bradford & Bingley would not say how many of their customers were in arrears and possibly looking at losing their home. As with many lenders, Bradford & Bingley increased their mortgage interest rates and costs over the last few months because of the credit crunch.

Today, they went further and said that these increases had “more than compensated” for the increased costs involved in their wholesale borrowing.

“Supply has clearly becoming more constrained with the withdrawal of several competitors from the UK mortgage market. However, demand for buy-to-let remains robust, with landlords reporting continuing tenant demand and rising rents,” said Crawshaw.

Crawshaw also said that Bradford & Bingley were still looking at the mortgage assistance plan proposed by the Bank of England and would probably take part, although they say they are still financially sound and hasn’t even touched their funding facility of £2 billion set up this year.