Mortgages  

Broker launches second charge advice service

Broker launches second charge advice service

Secured lending broker V Loans has launched a Mortgage Credit Directive-ready second charge advisory service.

A statement from the firm explained that networks, firms and individual advisers can now ensure clients have full access to second charge lending when moving a re-mortgage to first charge is either unsuitable or unavailable.

It is designed to help those advisers who do not wish to take on responsibility for advising on second charge mortgages following implementation of the MCD in March.

Last autumn, the Financial Conduct Authority warned mortgage brokers to get ready for the EU directive by applying early to be second charge, or risk losing their independent status.

At that stage, just three advisory firms had been given authorisation by the FCA, with another five brokers in the process of applying for full authorisation and a further eight in the process of applying for the lending authorisation.

For those advisers that wish to remain in scope of the rules, the V Loans service enables them to refer borrowers who would benefit from exploring the option of a second charge.

They will receive a full hand-off referral service, delivering all of the advice and regulatory requirements for second charge, while providing a revenue stream for successful referrals.

V Loans estimated that for about one in 10 remortgage customers, a second charge will be a more suitable option, with the result that many organisations and their advisers will not offer advice directly for both firsts and seconds when a second may only be appropriate for a selection of clients.

Managing director Marie Grundy said advisers who opt not to have second charge loans within scope at all are missing a huge opportunity for placing business which otherwise is either unsuitable for first charge or where a first remortgage is unavailable.

V Loans was acquired by Key Retirement Group in October 2014. It is a trading name of Key Secured Lending, an appointed representative of Key Retirement Solutions.

peter.walker@ft.com