Brian Pitt, director at Beacon, admitted the company had not informed any of the lenders it packages for of its move into lending until it actually launched Beacon Homeloans this week.
Beacon Homeloans will specialise in the non-conforming market and will compete with the likes of Kensington Mortgages, SPML, Mortgages plc and Preferred Mortgages, all of which Beacon packages for.
Keith Street, director of sales at Kensington, said he did not know about Beacon’s new lending venture. “This is a surprise. But, similarly, we had a relationship with Genesis when it was owned by Mortgages plc. We don’t see it as a conflict of interest.”
Peter Beaumont, sales and marketing director at Mortgages plc, commented: “Ultimately, Beacon’s products will have to stand up on their own two feet. We don’t fear any lender.”
But Dale Knight, director of mortgages at Berkerley Berry Birch, said other lenders should be worried about Beacon’s new proposition. “I have seen details of its criteria. Beacon Homeloans is going in very aggressively and will be chomping on the bit of Mortgages plc and similar lenders.”
Pitt said: “There is no conflict of interest here. Our lender arm is completely separate to our packager arm. This just gives our packaging arm another lender to choose from.”
Pitt also denied the move into lending was designed as a safeguard to surviving regulation which has seen other packagers already fall by the wayside.
Distribution of Beacon Homeloans’ products will be exclusively via the ten members of the Regulatory Alliance of Mortgage Packagers (RAMP). Financial backing of the new company comes from HVB, the German investment bank.
