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Brokers ‘need greater secured loans awareness’

  • 07/09/2010
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Brokers ‘need greater secured loans awareness’
Brokers need to wake up to the potential of secured loans to help remortgage customers in the face of funding restrictions, secured finance packager Brunel Mortgages & Loans has claimed.

Rob Derry, managing director of Brunel, said funding is becoming increasingly available in the secured loans market and could offer help to many broker clients, such as the self-employed or those with any adverse credit history, who do not qualify for a remortgage.

Derry highlighted FSA figures that show that remortgages have fallen to 38% of the mortgage market compared to 60% in 2008/09 as traditional SVR rates have fallen well below fixed rate deals.

He said there had been a lack of secured loans funding over the last three years, but this is now returning and lenders are beginning to compete for business.

Derry said: “There is a great place for brokers in this market as some of the best deals are only available through intermediaries.”

He explained: “Secured loans offer products to many more customers than the select band who qualify for a remortgage today and, if borrowers wish to consolidate their secured loan and mortgage at a future date when funds are more available and rates stabilise, there is no ERC on the secured loan.

“It is essential for brokers to raise their awareness of the problem-solving potential of secured loans if they wish to increase their business levels and offer the best service to their clients.”

David Johnson, chief executive of Link Loans, said: “Demand is set to build as structural changes in the mortgage market bite and consumers continue their shift to home improvements as house moves remain subdued. When combined with the refinance potential that exists with the current level of credit card and unsecured lending, the opportunity for intermediaries is once again starting to look appealing.”

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