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Paragon Rises from the Ashes
Paragon, the buy-to-let mortgage specialist has said it is ready to resume lending to new customers following its withdrawal from the market two years ago.
IntroducerToday.co.uk – 25 November 2009
The Solihull-based lender was forced to launch an emergency GBP 287m rights issue to avert receivership in January last year. The collapse in the securitisation markets left it without funds to offer mortgages at competitive rates.
Since last year, Paragon pulled back the breadth of its lending to existing mortgage holders and reduced lending from its consumer finance arm.
Nigel Terrington, chief executive, said the past six months had seen “significant improvements” in the wholesale funding markets.
The buy-to-let market has seen lending and competition dwindle with lenders Bradford & Bingley and Northern Rock exit the market.
Terrington said the recent improvements “will encourage us to look more confidently to reinstating the funding programme to support new lending”.
Terrington said the recent improvements “will encourage us to look more confidently to reinstating the funding programme to support new lending”.
Paragon’s mortgage completions shrank to GBP 25m from GBP 904m, while new business at its consumer finance arm also fell from GBP 222m to GBP 60m.
Paragon mortgage accounts with three months of arrears, which hit highs during spring this year, stood at 1.54 per cent, against the UK’s overall arrears rate of 3.23 per cent for buy-to-let lenders registered by the Council of Mortgage Lenders.
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