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On Ladder to close

  • 09/04/2024
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On Ladder to close
Start-up mortgage lender On Ladder will close down, as it was unable to progress with its Financial Conduct Authority (FCA) authorisation due to being unable to meet funding requirements.

On Ladder was founded by Cameron Orcutt (pictured), co-founder and CEO, and Samuel Hartley, co-founder and chief technology officer (CTO), in 2020 and focused on offering flexible deposit finance to help get more first-time buyers on to the property ladder.

The scheme would have worked by offering low, interest-free monthly payments, and the borrower could pay back the loan early upon sale or remortgage.

The company had been pursuing FCA authorisation, but had struggled to meet regulatory funding requirements due to the heightened base rate environment making raising capital more challenging.


‘No route forward’

Speaking to this publication, Orcutt said: “We got to a point last year where we had everything in place, and it came down to regulatory capital requirements for new mortgage lenders.”

As part of authorisation requirements, three years of funding need to be evidenced to proceed with authorisation.

Funding has become more challenging as the heightened base rate requirements have increased the cost of capital.

Orcutt said that the firm had tried pivoting to a new offering, but while it got “far down the line”, unfortunately that didn’t end up working.

“When all doors are closed and there is no route forward, we have to close down,” he said.

The business consisted of Orcutt and Hatley, with Jackie Bennett acting as a non-executive director. The company also had business advisers in Paul Rippon, Richard Tugwell, Mark Prisk, Douglas Cochrane, and Julian D’Arcy.

Borrowers, whuch number around 500, who had signed up for the waitlist will be notified.

Orcutt said that he believed that an offering like On Ladder would help the market, pointing to the high house price ratio in the UK of 8-9 times income and the reliance on the Bank of Mum and Dad, meaning that some borrowers would need a “boost” to their deposit.

“My hope is that we can slowly be able to move towards solving that [housing crisis] in a meaningful and sustainable way,” he added.

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