Competition in the mortgage market is ‘important’

People may be having trouble obtaining finance for a home because there is not enough competition between providers, one expert has suggested.

Director of the Association of Mortgage Intermediaries (AMI) Robert Sinclair called current conditions in which a small number of operators control the majority of the sector “bad news”.

He said: “We need to see an increase in the number of lenders or at least increased levels of lending among those in the market.”

Many individuals, particularly first-time buyers, will find it difficult to acquire financing for a property and a recovery will be stalled if measures are not taken to increase competition, Mr Sinclair added.

Approximately 80 per cent of the current account market is controlled by four banking groups and six institutions control 90 per cent of the mortgage sector, he remarked.

In recent news, Dominic Lindley at Which? urged the Financial Services Authority to do more for people getting into debt on their homes.

By Francis Finch