The last few years have seen a number of new lenders enter the market, across both the mainstream and specialist sectors. And they are appear to be having a positive impact. In a recent Mortgage Solutions poll, around 60% of brokers said that new lenders had made a real impact on the business they conduct with their clients.
David Sheppard managing director of Perception Finance, argued that the presence of new lenders had pushed mainstream names to adopt a revised outlook on less vanilla cases.
He said: “We have seen many lenders recently who have mentioned that they will look at clients that they previously would decline outright, especially those with what historically would have been called ‘light adverse’. That is a positive consumer outcome as there are lots of people out there that may have missed the odd loan or credit card payment but are generally good borrowers.”
Aaron Strutt, PR and communications director at Trinity Financial, agreed: “After watching so many lenders disappear from the market during the credit crunch it is great that so many have come back over the last few years. They have helped to introduce competition and have certainly given the biggest banks and building societies something to think about.”
James Mole, head of mortgages and finance at Nova Financial, singled out Keystone Property Finance for praise. He explained: “The head of sales or a BDM is always on hand to help me with tricky cases and they can make decisions on a case by case basis, and that is refreshing. The standard range is fairly flexible but when more is needed the solutions range covers nigh on everything.”
Sheppard added: “TSB are slowly changing their criteria to make them stand apart from Halifax having initially having the same stance on everything and that has been useful. Tesco have had some very good exclusive rates and Post Office/Bank of Ireland have picked up a decent level of business from us as well.”
Metro Bank picked up praise from brokers for its offerings to contractors, being flexible on incomes and top slicing income for buy-to-let. It is in these more niche areas where new lenders are particularly establishing themselves.
Mole said: “HMO and limited company lending markets are starting to be serviced by the smaller lenders, which is great and I hope that continues to expand. I would like to see some more lenders accepting new build properties and removing the LTV restrictions that some have in place.”