UK asset backed scheme fails

UK asset backed scheme fails

15 July 2009 by Staff Reporter 0 comments

A government scheme to kick-start the UK mortgage market is not working, MPs have said.

The £50 billion ($104 billion) asset-backed scheme, announced in the country’s budget, provides guarantees on lenders' mortgage-backed securities – a step that enables them to sell on mortgages to investors, raising new money to lend to consumers.

But restrictions on which institutions can take part, and the types of loans that it covers, meant that it had so far experienced limited success, the MPs said.

Latest figures show that mortgage lending picked up in May. But the number of home loans was still 28 per cent lower than a year ago, according to the Council of Mortgage Lenders (CML).

A government scheme to kick-start the UK mortgage market is not working, MPs have said.

The £50 billion ($104 billion) asset-backed scheme, announced in the country’s budget, provides guarantees on lenders' mortgage-backed securities – a step that enables them to sell on mortgages to investors, raising new money to lend to consumers.

But restrictions on which institutions can take part, and the types of loans that it covers, meant that it had so far experienced limited success, the MPs said.

Latest figures show that mortgage lending picked up in May. But the number of home loans was still 28 per cent lower than a year ago, according to the Council of Mortgage Lenders (CML).

promoted content
Recommended by Spike Native Network
Listen to other installment of the Real Estate Business Podcast
reb top 100 agents 2016

With a combined sales volume of $13 billion in 2016, the Top 100 Agents ranking represents the very best sales agents in Australia. Find out what sets them apart and learn their secrets to success.

featured podcast

featured podcast
William Phillips on how agents can expand their database and grow their business

Get up close and personal with the best real estate sales agents in Australia in Secrets of the Top 100 Agents. ...

View all podcasts

Are dodgy agents being punished enough?

Yes (8.6%)
No (55%)
Only in some states (2.3%)
Not all dodgy agents are being found out (34.1%)

Total votes: 220
The voting for this poll has ended on: April 15, 2017
upcoming events
REB Awards
Sydney The Event Centre 12 Sep
REB Awards
Sydney The Event Centre 12 Sep
Melbourne The Event Centre 14 Oct
Brisbane The Event Centre 18 Dec
View all events
Do you have an industry update?