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Press release

BSA comment on negative equity mortgages

Contact: Hilary McVitty
Date: 15 Dec 2011

Commenting, Paul Broadhead, Head of Mortgage Policy at the BSA said:

"Negative equity mortgages are not a new phenomenon and have been on offer from a number of lenders for some time. Generally borrowers in this position are well able to pay their mortgages, but just need some additional flexibility to allow them to move home, say for a new job. There is no extra lending involved, it’s about the mortgage provider allowing the negative equity element of the loan to be portable.

"We are hopeful that the FSA will include consideration of a number of borrower circumstances in their report to be published on Monday. We have been lobbying for there to be no hard regulatory limits on loan to value ratios as these could cause issues for a variety of borrowers – not just those in negative equity."

~Ends~

Contact:
Hilary McVitty - 020 7520 5926 / hilary.mcvitty@bsa.org.uk

Notes

The Building Societies Association (BSA) represents mutual lenders and deposit takers in the UK including all 47 UK building societies. Mutual lenders and deposit takers have total assets of over £375 billion and, together with their subsidiaries, hold residential mortgages of over £235 billion, 19% of the total outstanding in the UK. They hold more than £250 billion of retail deposits, accounting for 22% of all such deposits in the UK. Mutual deposit takers account for 34% of cash ISA balances. They employ approximately 50,000 full and part-time staff and operate through approximately 2,000 branches.
Photographs of Paul Broadhead are available from the BSA press office, or from the Association’s website at www.bsa.org.uk or Headlinemoney www.headlinemoney.co.uk