The packager, which is backed by Edinburgh Mortgage Advice, has already started working with Mortgage Advice Bureau for specialist lending in Scotland and Northern Ireland. It will focus on a range of specialist areas from bridging finance and commercial mortgage to development finance and second charge loans.
MS: Tell us a bit about the team behind Thistle
MD: Well, the two main protagonists at Thistle Finance are myself and Nathan Ellis-Calcott. I’ve got a background as a mortgage broker and set up Edinburgh Mortgage Advice seven years ago. These days, I’m no longer writing business but am still pretty involved, which means I probably just get on the nerves of people who are actually writing the business. Nathan, who is sales director, is the perfect foil to my own more conventional mortgage background, having worked within specialist lending for over 15 years at companies such as Brightstar, Link Lending and The Loans Engine. We think that our knowledge sets and experience really complement one another and enable us to see things through the eye of packager and broker alike. That’s why we decided to launch it together.
MS: Why is now a good time to launch?
Mark Dyason (pictured) : We feel that there’s an opportunity within the packaging market, and that it’s not quite serving brokers and their clients as well as it could. I suppose you could say we want to take it back to its roots and restore some old-fashioned packager values. There’s another problem, namely that too many of the established packagers are based in the South, so the North and in particular Scotland and Northern Ireland can be a bit of an afterthought. It’s a gap that we have set out to fill.
MS: How will you set yourself apart from the competition?
MD: Our plan is fairly straightforward: we plan to offer a great and professional service to brokers, a raft of exclusive products from a selection of lenders, and a competitive fee structure. Our second charge fee structure, for example, is going to be significantly lower than is being offered by some master brokers in the market. In other words, we’re not setting out to recreate the wheel here — just offer a better, more professional and more personal service than is currently on offer.
MS: Mortgage brokers still don’t seem as engaged with seconds as they could be – how can the industry change that? What do you plan to do?
MD: That’s true, they’re not as engaged as they could be. Saying that, they are certainly far more engaged than they were a few years ago — and the number of seconds being taken out is rising all the time. These days, more and more second charge lenders are emerging that genuinely complement the first charge market. Fees are lower, there’s a lot more transparency and as a result things are almost taking care of themselves. I genuinely believe the seconds market will become an integral part of the mortgage market in the year ahead, as brokers better understand how they can add value. One problem holding things back is the fact that, while the fee structure is changing, it’s changing too slowly. A reason for this is that there are a number of master brokers whose fee models are a bit out of sync with the market today. Ours will not be and so in that regard we hope to play a role in getting more brokers onside. What’s also not in doubt is that packagers such as ourselves need to do a better job of educating brokers and explaining how seconds can add value and how, just as with firsts, it isn’t all about the rate. It won’t happen overnight but we’re getting there.
MS: Why hasn’t the market reached its potential yet?
MD: The punitive fee structures that are still in the market are one reason, while a lack of education as to the benefits of seconds is another. But as above, that is all starting to change.
MS: Some argue that broker fees in second charges are too high. Where do you stand on this?
MD: Damned right they are. The fees being charged by some master brokers are simply unjustifiable. They’re one of the main factors holding the seconds market back. We, of course, intend to change all that.
MS: What do you think is the biggest challenge facing the second charge market?
MD: Aside from the challenging the fee level status quo and rolling out an education program to highlight the changes made in the market that can add great value for brokers, I think the next challenge is to encourage a high street lender to enter or return to the second mortgage market. The market is ready for it, and in fact needs it, as it will serve as a validation of the journey this sector has undergone in recent years.