3 Comments 3 Commentsby Jenny Ruth
Led by business development manager Scott Bailey, Economy will initially provide three types of mortgages to Loan Market's about 145 mortgage advisers in New Zealand who will be able to market them under their own business brands.
From next month, Loan Market brokers will be able to access finance for standard prime home loans, non-resident prime loans and an uninsured low-doc product with a revolving credit facility.
Bailey told Loan Market's annual conference the target market for the prime loans includes first-home buyers "looking for a good rate, guidance and service. Borrowers wanting an alternative to the banks."
The low-doc product will be aimed at self-employed people such as those who have only been in business a short while and who want access to a line of credit. It would also be suitable for investors -- Economy will offer five-year interest -only loans "at a compelling LVR (loan-to-valuation ratio)," Bailey says.
It may also suit those looking to refinance or to consolidate debt or those wanting to cash up equity for an investment property or to invest in a business, he says.
Through Economy's ecoOnline service, Loan Market mortgage advisers will have access to full loan details.
"It's your product, your way to get a client for life." Rather than having to contact a call centre, clients will be about to deal directly with their adviser on all matters relating to their loan, Bailey says.
Economy will offer a full suite of interest rates from floating through to five-year fixed -term mortgages - it won't offer six or 18 month terms at first, but those terms will be offered further down the track.
Australia-base Resimac chief executive Allan Savins told the conference Resimac and Loan Market have operated a similar joint-venture in Australia for the last two years.
Before the GFC, there were 30 non-bank mortgage lenders in Australia but now Resimac is one of only two, Savins says.
Because of the exit from the New Zealand market of so many non-bank lenders, such as GE, "many of you have a sour taste I your mouths," he says.
What differentiated Resimac from the other non-bank lenders was its access to capital and its relationships with investors around the world, Savins says.
Resimac has been operating for the last 27 years and ratings agency Standard & Poor's has given it a "strong" ranking.
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