Ministers 'knew about reckless lending four years ago...

07 October 2009

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2 Comments

Written by rosalind renshaw

Lenders and government ministers were aware of reckless lending as long ago as 2005 but each felt that the proble was the other's resposibility.

The revelation comes from the British Property Federation, which attended meetings with the Treasury and Financial Services Authority at that time.

Ian Fletcher, BPF director of policy, said: "Many lenders simply threw money at buy-to-let borrowers during the boom, without sufficient checks on who they were lending to or what they were lending for."

The BPF is now alling for a crackdown on all buy-to-let mortgages and property investment clubs, saying they should be regulated by the FSA.

Currently, buy-to-let mortgages are treated as business loans, whilst thousands of amateur landlords have been bankrupted after buying through property clubs.

Comments

- Richard
That’s the problem, no one who should , really believed or understood what they were allowing to happen. They may be highly intelligent with no common sense, that has cost us all very dear and will do for years.
- 07 October 2009 12:19 PM
- PeeBee
Sorry?? - lenders felt that THEIR reckless lending was someone else's problem?
Isn't there some cast-in-stone regulatory issues here - or am I just naive?
- 07 October 2009 10:37 AM