Zephyr Homeloans Q&A: ‘We’re under no illusion that we’re entering a very competitive market’

The buy-to-let lender is funded by as yet unnamed institutional lenders but began by signing distribution agreements with some of the bigger name packager and master broker firms.

Zephyr completed its first case in January but has otherwise been content to shy away from the glare of the market.

However, Specialist Lending Solutions managed to find time for a quick question and answer session with Paul Fryers, senior manager at Computershare Loan Services.

SLS: What is Zephyr’s business launch strategy? Are you looking for a big bang into lending right from launch, slow steady growth or to be a smaller specialist player?

PF: We are developing a long-term business based on strong relationships with key partners in the intermediary market in order to drive optimal, high-quality business to our funding partners.

We’re focusing very much on service and product provision to drive good outcomes for our customers and intermediary partners.

SLS: What do you think of the state of the market Zephyr is entering? What are its strengths and weaknesses?

PF: In common with most industries, there is uncertainty due to Brexit.

We believe that changes in the buy-to-let market during recent years provide an opportunity for specialist lenders to add value by providing products that match customers’ needs. These include landlords and investors who need a mortgage for limited companies, multi-units and houses in multiple occupation.

SLS: Where does Zephyr see its proposition sitting compared to others?

PF: Because we focus on the specialist lending market, we are able to offer a range of competitive deals when it comes to loan sizes, with fee and non-fee options. Our underwriting process and approach means that we can be flexible when it comes to deciding whether to underwrite large portfolios.

SLS: At the moment Zephyr is working with just a few of the big broker and packager firms, will this be expanded?

PF: We’re now working with a range of key partners, with the current total standing at 23.

SLS: Will you eventually go direct to the full broker market?

PF: We have plans to grow Zephyr and will therefore seek to expand distribution when the time is right.

SLS: Is the product suite that you launched with set for some time, or will it be expanded further?

PF: Products are constantly under review in order to seek the mix and flow of business that we intend to generate, so there is potential that the suite may change from time to time.

SLS: Is moving into other market sectors, for example residential, on the cards?

PF: At this stage we are focused on building Zephyr and we’re under no illusion that we’re entering a very competitive market and cannot stand still. We will assess opportunities to expand the business as they arise.

SLS: For Computershare, how has the change been from administering books to now taking on new business and everything that comes with launching a new lender?

PF: Computershare’s core function hasn’t changed and our servicing business remains as strong as ever. The addition of Zephyr is simply that – a new business capability that enhances our core proposition.