IMLA jumps to the defence of mortgage lenders

The Intermediary Mortgage Lenders Association (IMLA) has today jumped to the defence of mortgage lenders who are the subject of the latest attack by the Liberal Democrat Shadow Chancellor of the Exchequer, Vince Cable.

Vince Cable suggested that the Council of Mortgage Lenders (CML) guidelines dealing with arrears were unlikely to be followed without the threat of financial punishment, including statements that "This CML statement is welcome, but we must wait to see if these declarations of intent are actually implemented. What will the penalty actually be for CML members who ignore the guidelines?"

"There are many subprime lenders and other creditors who do not have the scruples of the main mortgage lenders. Unless these guidelines are enshrined in law, it is difficult to see what impact they will have on the spiralling number of repossessions."

In response, the IMLA has denounced the claims, calling them "inaccurate" and "misleading". Peter Williams, Executive Director of the IMLA stated

"Vince Cable fails to understand that subprime lending has essentially been mainstream mortgage lending. There are a significant number of ordinary borrowers and lenders in the sector. Subprime lenders are fully committed to working with borrowers in difficulty to help them avoid possession - and already engaged in all the agendas the CML are talking about. It is of course in lenders interests that borrowers remain in their homes and, accordingly, that they exercise forbearance and flexibility towards individual borrowers circumstances, not least because it is not an easy market in which to sell a property."

Mr Williams went on to say that many IMLA members were already taking steps to help borrowers who are faced with problems, and gave as an example GE Home Lending who own brands including both First National and IGroup. He stated that,

"GE Home Lending, working with the Foundation for Credit Counselling (FCC), is now piloting a free mortgage advice service for borrowers with financial difficulties and other lenders are also working up schemes." and concluded by saying "Lenders will become more pro-active without a doubt but it remains essential that borrowers with difficulties in meeting repayments communicate with their lenders throughout,"

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