5
Mar
Darling proposes "kitemark" for mortgages
Chancellor of the exchequer Alistair Darling has unveiled plans to
rank mortgages according to risk, it has been announced.
The least risky products, comprising only loans that meet tough
standards of creditworthiness and quality thresholds, will be given
a gold kitemark.
Mr Darling will publish his plans, which are designed to reopen the
market for wholesale mortgage financing to be unveiled, in next
week's Budget.
Banks have warned that this could create a two-tier system which
could lead to some sectors of homebuyers paying more, including
those with lower income, less creditworthiness or who wanted a
higher loan-to-value mortgage.
British Bankers' Association (BBA) chief executive Angela Knight
told the Financial Times that while there was "merit in the
proposal" she did not want measures to lead to "stigmatising
non-conforming mortgages".
Mr Darling will announce his Budget on March 12th and the BBA has
also made calls for the government to rethink its stance on
taxation.
