Kensington Mortgage Company Is Back On the UK Mortgage Market

On Thursday, November 26th, Kensingston Mortgage Company, which used to be the largest provider of mortgage loans to borrowers with bad credit histories in the pre-downturn market, announced that it re-enters the UK mortgage market. Kensingston launches a new mortgage deal, which is believed to boost competition and, thus, contribute to further recovery of the UK mortgage market. The mortgage deal offered by Kensingston, which is currently owned by Investec, a specialist banking group, comes at 5.69% for a 2-year fix. The maximum loan to value ratio available for the deal is 65%; only so-called “near-prime” borrowers are eligible to apply for the offer. At the moment, this is the only mortgage deal available from Kensingston, and it is only accessible through a limited number of UK mortgage brokers. The lender, however, claimed that it plans to launch a number of other mortgage offers in the near future. Kensingston’s head, Mr. Keith Street, said that the lender is cuurently taking a cautious approach to lending as the recovery of the UK mortgage market is slow. He, however, highlighted that the new products available through Kensington are and will be developed carefully, based on the experience and expertise of both, Kensington itself and Investec. Despite the fact that the new deal by Kensington mainly targets “near-prime” borrowers with good credit histories, it offered hope for a large number of borrowers who have been excluded from the UK mortgage market due to tight lending criteria introduced by most British lenders. Kensington highlighted that it will take a more flexible approach when assessing mortgage applicants than other UK lenders do. Mortgage brokers describe the new offer from Kensington as the one that does not try to compete with leading mortgage deals, in terms of interest rates, offered by other UK lenders. Instead, it provides potential borrowers, who have been turned down by other banks and building societies, with “flexible approach to underwriting”.