Coventry improves subprime lending criteria

27 October 2006
Coventry Building Society has made what analysts are referring to as "a strong move" within the credit impaired mortgage lending market by re-evaluating its criteria on lending to bad credit borrowers.

The mutual has been involved in this particular specialist lending industry since July and has already caused a stir among observers with its market-leading rates, starting at 5.9 per cent.

However, the Coventry has now sought to improve its standing further by improving its loan-to-value rates to 90 per cent, ignoring defaults and County Court Judgements that are over 36 months old and allowing its subprime customers to move to prime products when they are able.

"It's great to see a lender listening to introducers and, as a result, making improvements like the Coventry has done with its credit impaired range," said John Malone, the managing director of mortgage comparison service PMS.

"The Coventry has developed its proposition with [directly authorised brokers] in mind - the products, lending policy and processes make it easy for mortgage advisers to do business with them, without the need to go to packagers.

Mr Malone added that he "welcomed the Coventry to the market" for the fact that its subprime lending packages would now not feature early repayment charges and allow customers to transfer to a prime product when applicable.

To read more about bad credit mortgage products, click here.

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