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Fewer Mortgage Products For Consumers, A Good Thing?

The UK housing market is seeing the same sort of credit stress as we are on this side of the pond. In the FT’s article Mortgage product market squeezed [1] (non-subscription vers [2])

There are now just 2,282 home loans from which borrowers can choose – less than half the number of products available one year ago and more than 90% below the 27,962 available in July 2007, according to the comparison site moneysupermarket.com. First-time buyers can access 1,195 mortgage products down from 17,756 in July 2007.

A similar thing has happened in the US.

While choice is a good thing, I saw the large number of mortgage product choices during the credit boom as more of a reflection of loose lending standards, a symptom of the problem.

I’m not sure fewer choices aren’t a bad thing. Am I missing something?