The addition of a direct submission route alongside its newly streamlined master broker panel will give mortgage intermediaries more choice in how they submit second charge lending cases.
Second charge lending is a growth market with excellent opportunities for mortgage intermediaries. The FCA states that it expects the vast majority of second charge sales to be on an advised basis – this is undoubtedly an area where intermediaries excel.
The fact that second charge loans are now regulated by the FCA under the MCoB regime means that the advice and lending processes for second charge loans should become as straightforward as in first charge lending.
In order to ensure mortgage brokers and advisers are properly compensated Precise Mortgages has set the procuration fee at 1.25% for direct business which aligns the fee to a similar level as if a remortgage had been advised.
Customers who wish to raise extra funds may be better off leaving their existing mortgage in place and using a second charge loan instead include:
· Customers on lifetime tracker rates paying low margin over BBR
· Customers with an interest only mortgage
· Older borrowers who may not pass affordability tests on a remortgage but may be able to pass with a second charge on a different term
· Customers trapped with lenders who will not allow further advances
Highlights of Precise Mortgages new second charge loan products:
· Rates from 4.45% with a £300 product fee, or 4.75% with no product fee
· Bank of England base rate lifetime trackers and fixed rates
· ERC and no ERC product choices available
· Affordability on 5 year fixed rates is based on initial pay rate not a stressed rate
· Residential Prime, Almost Prime and Near Prime ranges
· Buy to Let Prime
· Loans from £5,000 – £1,000,000 (loans above £500,000 priced on request)
· Terms of 36 to 360 months
Alan Cleary, Managing Director of Precise Mortgages says:
“We firmly believe this direct to broker second charge proposition will improve the choices available to the mortgage intermediary market and to the end consumer. We are in talks with many major mortgage clubs and networks about bringing this opportunity to as many brokers and advisers as possible and anticipate making a number of announcements very soon.”