National Homebuyers: 'Paragon faces collapse'

A leading British buy-to-let mortgage lender has admitted that it is on the brink of collapse as a result of the global credit crisis.

[UKPRwire, Mon Nov 26 2007] Paragon Mortgages, Britain's third largest buy-to-let mortgage provider, said that it is struggling to raise funds and may be £280 million short.

As a result, shares in the company crumbled to almost half their value and fears are growing that two of the UK's biggest mortgage lenders are in real trouble following the run on Northern Rock earlier this year.

"We're in pretty dramatic times," Paragon's chief executive Nigel Terrington told Reuters.

"Partly the housing market is slowing down anyway, but we have tailored our volumes because of the (financing) environment.

"It would be pretty irresponsible to go hell for leather and start putting billions of loans on your balance sheet," he added.

The turbulence in the UK mortgage market will be of huge concern for homeowners across the country and could lead to financial difficulties and repossessions for many.

Julian King of National Homebuyers says, "Like the Council of Mortgage Lenders [CML] our analysts are predicting around 30,000 repossessions by the end of the year. Hundreds of thousands more will find the 'pinch' even more distressing.

"People who are looking to avoid the potentially disasterous financial implications will find selling their house a further problem.

"The necessity to sell quick will increase and the ability to sell quick will decrease in the coming months. Vendors who need a fast property sale will need to look to alternative methods in order to avoid repossession".

Mr King is a director of National Homebuyers, the UK's leading fast property purchase firm. The Sussex-based busines guarantees to make an offer to purchase any property in the UK for vendors who need a quick cash house sale.

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