Crunch time for low-income households
18 October 2007
Credit Action (CA) has warned that low-income homes in the UK will find it increasingly difficult to get mortgages in the coming months; however door step lenders may provide a viable alternative.
The recent turbulence in the global credit markets has caused the sub-prime market to feel the effects of such tensions as the Northern Rock crisis.
The credit charity warned that many potential homeowners may find getting a mortgage tough, however alternative routes still exist for people with bad credit, such as door step lenders.
A spokesperson for CA said: "The sub-prime market accounts for something like ten per cent of the mortgage market, and obviously that has been affected by the situation in America.
"There is no doubt that the less well off will find it harder to get mortgages."
However she added: "The companies that traditionally provide for the less well off, such as the door step lenders, won't be affected because their system is so different."
Bad credit loans - which often carry higher rates of interest - are borrowing options that can be taken by people who have a poor credit history.
