Non-conforming lenders fuel mortgage growth
The ballooning demand for mortgage credit in Spain is attracting new players and more flexible products.
The country has a small non-conforming sector populated by lenders such as GE Money Bank Mortgages and Unión de Créditos Imobiliaros – the latter having funded its business in the securitization market since 1994. Non-conforming and sub-prime mortgage lending in Europe has traditionally been the preserve of the UK market but is now emerging in other countries, such as the Netherlands. Spain is consistently top of the list of markets most likely to experience expansion in sub-prime lending, thanks to huge demand and a securitization-friendly funding environment.
GMAC RFC, which has been at the vanguard of non-conforming mortgage origination in the UK and the Netherlands, is now poised to launch in Spain. “We plan to offer mortgages via both institutions and intermediaries,” says Ferdinand Veenman, country manager and managing director at GMAC RFC España in Barcelona. The company plans to open regional offices in Madrid, Seville, Valencia and Málaga. Veenman was transferred to Barcelona after setting up the firm’s Dutch operation. The firm plans to offer both Alt-A products (traditional mortgages with expanded product criteria, such as higher LTVs and flexible amortization) and Alt-B products.