Monday 3rd Sep 2007
Advantage has slashed it LTV to 75% across its sub-prime secured loan range with Paragon Personal Finance, as well as increasing rates by up to 3%.
The changes that come into effect on September 3 and will be a further blow to the secured lending industry, which is slowly seeing lenders decrease their LTVs.
In letter to brokers today from John Webb, managing director of Paragon, says: “All existing pipeline business will be honoured on current plans but must be reissued in compliance with the new criteria if not completed by October 31 2007 .”
A spokeswoman for Advantage says: “Morgan Stanley continues to purchase loans from Paragon. The new range is more reflective of the current risk environment in the UK secured loan market.”
A spokeswoman for Paragon says: “This is not a Paragon product.
"It is a secured second charge loan owned by Morgan Stanley, under the Advantage brand, and distributed through Paragon Personal Finance.”
Angelo Trapasso, director at Magic Loans, says: “Now that it has a much lower LTV there is nothing to separate it from other lenders.
"The 3% hike in its rates is also going to be felt.
"It has had very good service lately, I’m hoping it will come back into the market with a better proposistion.”
Source: http://www.mortgagestrategy.co.uk/cgi-bin/item.cgi?id=149024&d=337&h=24&f=254