Currently more than eight in 10 people with adverse credit think banks and other lenders aren’t interested in helping them, according to research by the bank.
So, as part of its mission to become the UK’s number one specialist lender, Metro Bank wanted to offer these potential borrowers greater flexibility.
It said it was currently the only high street lender offering near prime mortgages, despite data from PWC suggesting there could be up to 14 million people in the UK with less than perfect credit history.
Indeed, its own research – carried out with YouGov – discovered 41% of adults thought they had been prevented from getting a mortgage or remortgage as a result of their poor credit history.
A similar amount (43%) of people were worried that their mortgage lender options were limited and they wouldn’t be able to access a mortgage or remortgage their current home, due to their credit history.
Metro Bank’s near prime offering sits alongside its core range of residential mortgages, and enables borrowers with an imperfect credit history to purchase a new property or remortgage an existing property, at up to 80% loan-to-value (LTV).
The new range will accept applicants with lower than average credit scores and those who’ve had unsatisfied county court judgements (CCJs) and defaults, with no requirement for these to be repaid before the end of the loan term. The bank has also confirmed that it will accept unsatisfied defaults of up to £1,000, an increase from £500.
Charles Morley, director of mortgage distribution at Metro Bank, said: “It’s been an exciting few months for the mortgages team at Metro Bank. We’ve enhanced our criteria for buy-to-let lending, cut rates on our higher LTV products and added significant expertise to our team with a number of new hires.
“This all serves a purpose: to grow into the UK’s number one specialist lender. We’re continuing to make tangible progress, and we’re thrilled to offer this latest near prime offering to customers who may have been overlooked by the vast majority of the market.”
Today’s announcement is in line with the bank’s strategy to meet more customer needs, whilst shifting its asset mix and expanding its lending range. It forms part of the bank’s ongoing focus on balance sheet optimisation in order to drive better risk-adjusted returns on capital.
