The appetite for purchasing unsecured portfolios such as car loans and personal loans is growing, relative to mortgage loans.
One reason for this is simply that investors are finding it hard to source mortgage portfolios because those who were looking to sell are now ‘holders’ of assets because “they have already suffered the pain and now see the upside”. In addition it seems that the Credit and Risk teams within the Banks are reticent to approve a deal where it has the word ‘mortgage’ attached to it. This reticence is not just because of recent experience, but also the timescale of the risk compared to unsecured debt that has a much shorter time span to redemption.
We are increasingly being asked to undertake audits and reviews on these unsecured debts not just in the UK, but also in Ireland and mainland Europe. As you would imagine the quality of information held and processes in place varies from country to country, but with the international expertise and knowledge that we have within Rockstead we enjoy such interesting challenges. It also supports our view that, while the mortgage portfolio trade market is quiet, there is still interest in buying different classes of assets at the right price.