V Loans, the national secured loans packager, is asking mortgage brokers to reconsider secured loans as a logical choice for clients needing to capital raise in the wake of announcements by lenders to restrict access to interest only products.
According to V Loans’ Business Development Director, Dave Pinnington, the cutting back of the interest only payment option makes remortgaging much less appealing for customers and should increase interest in a stand alone solution for capital raising.
He said, “As more lenders either withdraw from or cut back interest only payment options, of course brokers are right to be concerned. The silver lining we can offer is for those cases where clients might normally have remortgaged to raise capital. Remortgaging and losing the interest only facility will add unnecessary extra cost. However, secured loans, apart from being particularly competitively priced with rates from under 7%, have a transparent charging structure and with low early redemption fees are particularly attractive as they are not tied to the longer term of a mortgage.”
He added “The withdrawal of interest only makes an even stronger business case for making secured loans part of every broker’s search process when looking to help clients.”