Future mortgages to stop lending

Citigroup, the owners of Future mortgages have announces that with effect from the 21st May Future will no longer be offering secured loans and mortgages in the UK. Brokers have been informed that all pipeline mortgage application will be honoured in what has been described as a controlled shutdown. Citigroup will still have a presence in the UK, and will continue to lend in the retail credit markets via their Citi and Egg brands.

The announcement is not a total surprise, following as it does on the introduction of far stringent lending criteria by Future in the last few weeks. This in itself follows a period in April when the lender suddenly and without warning ceased lending on second charge secured loans, only to return a few days later.

The closure will lead to around 670 redundancies, of which 400 will be at the Future processing centre in Doxford, Sunderland. This is bad news for Doxford, following the announcement by Northern Rock recently that they will shed roughly 2000 jobs in the same area by 2011.

Future has been beset with service issues over the last few years, and had failed to capture significant market share. With lenders such as IGroup and First National, both owned by GE Money, and the Britannia owned Platform ready to pick up the pieces, this announcement will not result in a gap in the market as significant as other recent departures.