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Paragon Loans and Mortgages

Paragon Group, the Buy to Let Mortgage and second charge loans company has responded to investor concerns which led to a 20% drop in it's share price, by stating that it's prospects for 2008 look good and the stability of the Buy to Let mortgage market will see it increase sales by 30% in the coming year.

Paragon provides mortgage funds to buy to let investors, but has to acquire all it's lending funds from the money markets as it does not take savers deposits unlike many other mortgage providers.

The company also provides loans for homeowners in the guise of secured loans or second charge loans. These are supposed to be lower risk loans as they are supported by the available equity borrowers have in their main residence. The large rises in UK property prices over recent years has meant that many more people now have the option of taking out these types of loans, as long as their income can support the repayments.

Rises in interest rates and the increasing numbers of immigrants from the European Community mean that the demand for rental properties remains strong, which in turn provides an encouraging market for new Buy-to-Let business.

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