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Solution Mortgages news on bad credit remortgages, poor credit remortgages and for people with arrears & ccj’s. Remortgage news with regards to the adverse credit market and people with sub prime credit.

Tuesday, April 15, 2008

Government meet lenders to try and resolve crisis

The chief executives of the major high st banks as well as senior investment bankers have been invited to Downing St today to meet Gordon Brown and discuss possible solutions to the current credit crisis.

The banks will be asking the prime minister to free up the money markets to ease the liquidity crisis and stave off any further damage to the economy. This will be no mean feat.

The talks are likely to be around reviving demand for the securitisation process and mortgage backed securities. There is also a real need to lower the inter-bank lending rate, which is the interest rate that banks lend at between themselves.

Other more extreme measures such as the central bank buying up mortgage backed securities and then holding on to them when demand picks up again, will be discussed.

The chancellor Alistair Darling has set an emergency meeting next week between mortgage lenders to discuss the effects of the credit crunch on the mortgage industry.

The government has criticised mortgage lenders for not passing on the recent interest rate cuts to borrowers but this could be seen as hypocritical as Northern Rock which is now owned by the government (or rather UK taxpayers) has also failed to do so. If you where a lender I am sure you would expect everyone to be singing from the same hymn sheet!

Again the emergency meeting will likely discuss the status of mortgage backed securities and how a stable model can restore a healthy market again.

If you have any questions on this article, please feel free to contact Solution Mortgages on 0845 123 1260 or visit us online at www.solution-mortgages.co.uk