MSC - Mortgage Securitisation Claims - Launch
Mortgage Securitisation: Whose Loan is It Anyway?
The UK’s millions of borrowers may feel they understand how their mortgages work but they could be in for a big surprise.
Most lenders in the UK offer loans so that people can buy residential property, whether this is for their own use or as buy to let landlords.
The mortgage acts as an additional security measure for the advance the borrower receives. Like most people, the borrower probably thinks the security is the property itself.
However, as Bruce Lamb, spokesperson for Mortgage Securitisation Claims (MSC) explains, this is not the case.
“The property is the underlying security, but the main security is the borrower’s pledge to pay the loan back over a defined length of time.”
This pledge is, essentially a promissory note. Is a negotiable security and it becomes an asset on the lender’s balance sheet, before any money is released.