Vida Homeloans has revealed plans to complete an aggressive expansion by the end of 2017 after beating expectations since its launch almost a year ago.
The specialist lender gained FCA approval in September 2016. It is available to both directly authorised advisers and appointed representatives.
But Louisa Sedgwick, director of sales of mortgages at Vida Homeloans, told FTAdviser talks to expand the company's distribution channels were underway with three large networks, which collectively amount to around 20 per cent of the intermediary market.
“We set ourselves a goal for the first 12 months and we will exceed the goal we set ourselves,” Ms Sedgwick said. “I think we have done exceptionally well.”
Vida has issued £1.4bn-worth of decisions in principle and processed £600m-worth of applications since its launch, and expects to see further significant growth over the coming months.
The lender deals with so-called ‘sub-prime’ residential and buy-to-let (BTL) cases not catered for by high-street banks and building societies, often because the borrowers have poor credit histories or irregular incomes.
Its client base includes people who have had difficulty obtaining finance, including for seemingly minor blips on credit records that were no fault of their own – such as charging errors by mobile phone providers.
Ms Sedgwick said specialist lenders had recently seen an increase in business on the back of tax and regulatory changes that have gradually been introduced by the government.
“Anything that is new buy-to-let is complex,” she said. “The big lenders don’t have the capacity. A lot have legacy systems, and the underwriting capacity or knowledge is not there. We have come up with some really good solutions.
“I think specialist lenders will benefit but will have to make sure they do it right.”
She described the BTL sector as a ‘false market’ because the tax changes for high-income landlords will be introduced over a number of years and landlords have not yet felt an impact.
Vida has been recruiting underwriters from across the country ahead of changes to underwriting rules for portfolio landlords, which are due to be introduced by 30 September.
“Brokers need to know their customers better,” Ms Sedgwick said. “It will become more difficult. We might see a change in some landlords’ attitudes to limited-company borrowing.”
simon.allin@ft.com
