Atom bank has experienced a notable increase in Near Prime mortgage applications, up over 10% in Q3.
- The rise in applications is especially significant when compared to the same period in 2023, showing a 47% increase.
- October 2024 marked a milestone for Atom bank, recording the highest number of applications since launching the range.
- Changes in application criteria have contributed to this rise, including adjustments in default thresholds and fee structures.
- Richard Harrison emphasises the importance of supporting borrowers with imperfect credit histories.
Atom bank has reported a substantial uptick in applications for its Near Prime mortgage range, with figures rising more than 10% in the third quarter compared to the previous one. This increase is even more striking when considering that it represents a 47% rise from the same three-month period in 2023. October of this year was particularly noteworthy, as it recorded the highest number of applications since Atom bank’s introduction of the Near Prime range in 2021, even surpassing the previous record set in July.
The enhancements to the eligibility criteria appear to have played a crucial role in this growth. In May, Atom bank decided to modify its conditions by more than doubling the permissible limits for unsatisfied registered defaults a client could have, increasing it from £1,000 to £2,500. Likewise, the defaults limit for communication and utility bills saw an increase from £250 to £500. Furthermore, the ‘look back’ period on defaults was reduced from three years to two, which may have made it easier for more applicants to qualify.
Along with these criteria adjustments, Atom bank expanded its offerings by including new three-year fixed rate mortgage deals in its Near Prime category, while also removing fees related to missed payments and arrears management. Such measures demonstrate a concerted effort by Atom bank to make its mortgage products more accessible to a wider audience.
Richard Harrison, the head of mortgages at Atom bank, stated, “The challenges of recent years have inevitably meant that some prospective purchasers have a less-than-perfect credit record.” He added that it’s unfair for temporary, historical credit issues to affect an individual’s current borrowing capacity. By refining their Near Prime criteria, Atom bank aims to better assist borrowers who might be underserved by mainstream lenders and ensure they are not unfairly penalised for past credit difficulties.
Harrison further stressed the importance of supporting Near Prime borrowers not just throughout their home ownership journey but also as they improve their credit status towards Prime. He highlighted that Atom bank remains committed to providing a process that is swift, straightforward, and offers good value. The bank encourages more brokers to capitalise on their offerings as awareness of their products continues to grow.
Atom bank’s strategic adjustments in its Near Prime mortgage offerings seem to resonate well, demonstrated by the significant rise in applications.
