Submitted on Tuesday 18th March 2008
Commercial First Stop Lending
Commercial First stopped lending today after failing to achieve a new securitisation
They released the following statement to brokers
We have explored every opportunity to obtain new funding. We have a business that made a profit of £13m last year and will make in excess of £20m this year, with a balance sheet of £1.8bn in performing mortgage assets at an average LTV of 68% and 4% margin - yet are still unable to obtain financing. It is clear the credit market has failed.
Commercial First revolutionised the UK commercial mortgage market by offering a series of commoditised products designed to offer alternatives for businesses that did not quite fit the Big Four model. Unfortunately that model depends on their ability to securitise their loan book and until that problem is resolved things have ground to a halt. Sadly for any clients that have mortgage offers with them the following advice was given
We are writing to all affected customers with an outstanding valid mortgage offer to notify them of the current situation and are providing a customer hotline number for them to contact. We recommend that customers with existing enquiries that are yet to progress be contacted in order to find alternative sources of finance.
