Paragon said: “The securitisation market has improved throughout 2011 and bond investor interest is increasing month on month.”
Paragon will launch a securitisation when the conditions are appropriate, it said, “before the end of 2011.”
Ben Hayward, fund manager with TwentyFour Asset Management, which manages the Monument Bond Fund the only mortgage-backed securities fund in the UK, said Paragon’s track record through the credit crunch has been noted and appreciated by the wider market.
“Going into the credit crunch, people thought buy-to-let could underperform, but Paragon’s assets were by and large on a par with the mainstream prime lenders,” said Hayward.
“Paragon knows which landlords it wants to target and builds up relationships with these borrowers over time. Paragon as a business relies on the performance of these pools of loans, so as long as they perform well, they get a profit stream.”
He concluded: “We expect a deal in the not too distant future,” he said.
Paragon’s 53rd and final securitisation was on 20 July, 2007 taking the total to £19.5bn. The specialist buy-to-let lender closed to new customers in 2008, when the credit crisis restricted its ability to borrow on the wholesale money markets.
However, the company secured a £200 million warehouse facility from Macquarie Bank and began lending in September 2010 intending to warehouse loans until ready to relaunch into the mortgage-backed securitisation markets.
Paragon’s pre-tax profits increased 34.8% to £39.5m in its half-year results for the six months to the end of March 2011. This was up from £29.3m in H1 of last year.
Paragon reported that it has advanced £50.2m of buy-to-let loans since returning to new lending in September last year and revealed it has £94.7m new lending in the pipeline.
Meanwhile, Paragon sister-lender, Mortgage Trust has launched a range of broker exclusives, including tracker rates starting at 4.30% and two ‘Rapid Remortgage’ 75% LTV deals with free legals and a valuation.
The lender is also offering a range of two-year fixed rates, starting at 4.89% for 65% LTV loans, rising to 5.09% to 75% LTV.
Mortgage Trust is accepting online applications only via the www.MTon-line.co.uk website and all applications are subject to a fast track credit score based underwriting process.
The ‘Rapid Remortgage’ deals are offered with a 1% fee and free legals and valuation. These deals include a 3.99% two-year tracker and a 4.99% two-year fixed, both at 75% LTV and the deals must be completed by 29 July 2011.
The products are for single, self-contained properties only and carry a 1.75% product fee.
Mortgage Trust, sister brand to portfolio and developer landlord lender Paragon Mortgages and part of The Paragon Group of companies, returned to buy-to-let lending in April this year.
John Heron, Mortgage Trust managing director, said: “These products offer attractive rates and criteria and we are confident they will appeal to intermediaries and landlords from across the spectrum.”
