Birmingham Midshires has unveiled its new brand, Birmingham Midshires Solutions, which will target mortgage intermediaries.
The new operation, which has been formed through a merger of Birmingham Midshires and Halifax Mortgage Services, will continue to offer mainstream mortgages but will initially focus on a number of specialist loans including buy-to-let, self-certification and expatriate mortgages.
Lee Smith, spokesman for Birmingham Midshires Solutions, said: “This is not going to mark the end of Birmingham Midshires as a mainstream lender, but in two years we will primarily be a specialist lender.”
Ten mainstream mortgage products will be available initially including, fixed, variable, discount, capped and tracker mortgages. The buy-to let range also includes these products and are available up to 85% LTV. Arrangement fees are a standard £299. The SVR product has an interest rate of 7.74% and is free of early redemption charges. In addition the self-certification products include a fixed rate of 6.85% until 1 February 2006.
The brand is now the only specialist lender within the Halifax group and it expects to receive around £1 billion in referrals from the other members, including Intelligent Finance (IF).
Smith said: “This is the beauty of being the only specialist lender within the group. Before, we were competing directly with our parent company, but we will now be complementing them and expect to greatly increase our volume.”
“If you look at the mortgage market as a whole, mainstream lenders are moving towards the specialist market because of the level of competition. It makes sense for us to complement rather than compete.”
Ron Howell, sales director at First National, welcomed the move, which provides similar structure to that of his own company. He said: “This move is just the first of many. It is good news for the borrower because they will end up with much better propositions than they currently get with sub-prime lenders. The buying power and financial resources available to mainstream lenders will help to develop new markets.”
The second phase of the Birmingham Midshires’ scheme will be launched next spring when it expands into the sub-prime sector. The exact details have not been confirmed although it is expected that the products will be based on the daily interest system. 80% of mortgage business currently conducted by Birmingham Midshires is through intermediaries, and while this is expected to grow in volume, the actual percentage of intermediary business will fall to around 50% of the total.