IMLA2014: Sub-prime still has place in market
Speaking at the IMLA Great Mortgage Debate Brodnicki said a properly regulated sub-prime sector was needed to help the market reach its potential.
He said: “I can see some real genuine interest out there [for sub-prime].
“There is room in the market for sub-prime to come back in and reinvent itself to fill a very real gap in the market.”
But Matthew Wyles, senior adviser at Castle Trust, was unsure if a return to sub-prime lending was the right thing for the market.
Wyles said: “Sub-prime is an extremely large church. A healthy rental sector is more important as part of a functioning housing market.
“Everybody needs a second chance but maybe some people should just be renting.”
But the regulator seemed open to a return of a properly regulated sub-prime sector.
Lynda Blackwell, mortgage policy manager at the FCA, said: “There is nothing intrinsically wrong with sub-prime as long as borrowers can repay their mortgage.”