Future Mortgages curbs loans to 90%

Future Mortgages, the specialist lending arm of Citigroup, has decided to restrict lending to 90% LTV on secured loan applications.

The news follows the resignation of Citigroup’s chief executive, Charles Prince, at the beginning of this week after the group suffered heavy losses from bad sub-prime debt.

Future Mortgages says it has received intense demand for its products, partly due to a new product range and online decision technology, but also as a result of other sub-prime lenders withdrawing their product ranges, driving customers to the few lenders still offering risky loans.

Future says many of the cases it has received since July have been for higher LTV loans and says restricting its maximum LTV is the prudent thing to do.

The lender confirmed that all other features of its products will remain the same and it will not be changing its lending criteria.

Ian Warrilow, head of secured lending, comments: “This decision has been taken as a response to a heavily-skewed business mix towards HLTV products and, given the current fallout from the US sub-prime credit crisis, we feel that, as a responsible lender, this is the right thing to do at this time.”

The company says it remains committed to the sector and is continuing to develop products and technology to meet market demands.

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