The withdrawal of RAMS from the mortgage broker channel will have no effect on the bottom line of most brokers The Adviser has reported today.
The mortgage industry undergoes constant changes. As lenders enter and withdraw from the market regularly brokers with robust business models will not feel the effects of the withdrawal of RAMS.
The withdrawal of one of the most prominent non-bank lenders is likely to open up new opportunities in the market. Space for new entrants has been created, or similarly, existing lenders could focus more heavily on pushing their products to the Mortgage Broker channel.
RAMS had previously tightened its lending criteria for loans obtained through the broker channel by pushing down loan to value ratios thereby requiring borrowers to contribute higher deposits.
The withdrawal from the broker channel didn’t come as a complete shock because of the earlier tightening activity and the previous announcement that the lender would no longer issue loans via mortgage brokers from 26 February.
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