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Written Submission 2.24
Mr C Dempster, Director – Future Finance Dear Mr Millow ,
Following the request to review and comment on the proposed Scheme I would make the following comments
As a purely local funder are active in both the mainstream mortgage, private mortgage area and we also provide personal loan to support the purchase of properties.
As a consequence we feel we are well placed to comment in this area of the market place.
The need for a support package to enable first time buyers to enter in the property market is unquestionable, and in general the proposal seems considered.
However I would be extremely cautious if the intention is for the states to administer this program.
As a commercial lender the current market is challenging and all credit application have to be extremely well underwritten and administrated cautiously throughout the life of the agreement.
You estimate 1% of the loan value is optimistic and 2% would be more realistic.
Also I would urge you to consider seeking external support in the administrative area of the proposal, there would be numerous advantages in the States using a third party to assist in the core process such as underwriting, collection of the repayments/interest charges and dealing with arrears etc.
I would be happy to offer any assistance/advice if you required, Kind Regards
Craig Dempster
Director Future Finance