Riskier UK Mortgage Bonds Face Reckoning From Housing Turmoil
- Non-bank lender bond sales have plunged as rates soared
- Buy-to-let loans are among those exposed to risk, Moody’s says
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One of the few parts of the mortgage-backed bond market that grew in the UK during the pandemic is now facing its moment of reckoning amid increasing economic turbulence.
The business of riskier securitization is shrinking, with mortgage lenders including LendInvest Plc and Keystone Property Finance Ltd. having sold only about £6.75 billion ($7.6 billion) of debt from April through the end of September, according to data compiled by Bloomberg. Those include pools of loans originated for borrowers who cannot access lending from high street banks, as well as buy-to-let transactions.