The fixed and variable rate second charge products are being promoted with Shawbrook in response to problems faced by borrowers - typically 50 to 60 years of age - who are struggling to secure mortgages lasting beyond their official retirement date due to restrictive lender criteria, and for retired applicants looking to borrow against the equity in their home.
Shawbrook offers two products for this customer profile – a Buy To Let second charge product, with rates from 7.45%, and a second charge mortgage from 4.99% above Bank base rate – which are available exclusively through V Loans and to customers of parent company Key Retirement.
Lending criteria for the loans has been specifically designed to be flexible to the needs of these borrowers. The criteria builds on changes in the market driven by tighter rules on lending into retirement, following the Mortgage Market Review.
V Loans believes demand for second charge loans for these borrowers (typically aged 50 to 60 years of age) will continue to increase and will work with Shawbrook to meet the needs of those borrowers who are excluded from mainstream lending based on age rather than their ability to pay.
Marie Grundy, managing director of V Loans, said: “The secured lending market is growing strongly but it is important lenders continue to look at responsible lending solutions which can be offered to older borrowers, and our partnership with Shawbrook Bank is a major step forward.”
Currently there are limited choices for older creditworthy customers in the residential mortgage market and it is crucial that the financial services market continues to work hard to provide suitable lending products in response to this.”
Maeve Ward, sales and operations director at Shawbrook Bank added: “The MMR has created a lending environment that is potentially excluding an entire section of the residential lending market on the basis of age alone. We are delighted to offer this range of products that we believe will meet the needs of this market demographic. Our human underwriting and rigorous risk management approach ensures that each case is considered on an individual basis to ensure a good customer outcome. We believe that this part of the market is underserved and expect to see increasing demand.
We are very excited to be offering products that take a responsible approach to meeting the needs of this growing market segment and look forward to working with V Loans going forward."
