The number of mortgage products available has shrunk by 40% since the beginning of the credit crunch, according to eMoneyfacts.co.uk.
Since July, both prime and sub-prime mortgage ranges have shrunk in size or disappeared altogether, with the sub-prime sector particularly badly affected.
A total of 6,411 products have been withdrawn in the past three months, according to eMoneyfacts.co.uk, and the sub-prime buy-to-let sector has been hit particularly badly.
There are now 72% less sub-prime buy-to-let products available, while the range of sub-prime residential products has dropped by 54%, a loss of 4,371 products.
As well as seeing most high risk sub-prime products withdrawn, the market has also had very tight lending criteria applied to remaining mortgages.
Prime products ranges have also seen cuts, though not as extreme as the sub-prime market. The number of prime buy-to-let products has fallen 20%, while prime residential ranges have been cut by 16%.
Commenting on the cut in products, Julia Harris, mortgage expert at eMoneyfacts.co.uk, says: “Clearly an overall 40% reduction in products available will mean less choice for borrowers, particularly for those with bad credit, irregular incomes or those looking for high LTV products.
“But equally as worrying is the fact that lenders seem to be allowing the market to stagnate, very few new launches are being made, rate changes are slow and there is a discernable lack of innovation.”
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