Last May the FSA made an adjustment on the penalties associated with secured loans amounting to £25,000 resulting in a much welcome boom in the UK secured loans market. A year on however, many companies operating in the industry face the possibility of a slow-down in the time taken to complete unregulated loans, as various regulatory bodies discuss the possibility of introducing regulation for loans above 25k, thereby affecting the speed at which loans can be processed. By introducing this change, this will effectively benefit the consumer with enhanced rights of cancellation, but at what risk to those operating in the secured loans market?
In order to compete effectively among an increasingly saturated market, companies looking to differentiate themselves from their competitors will need to work arduously in 2006 to offer more value to their clients. One company which is taking active steps to help progress the business is Cardiff-based secured loans company, Prestige Acceptance.
The company was launched in Sept 2003 by Darren Fry, a sole trader who started his career in the finance industry aged 16 via a Youth Training Programme. After working for a series of companies over the space of ten years, including Forthright Finance and On-line Finance, the 30 year-old dynamic entrepreneur saw the potential to launch his own business as he possessed first hand experience of undertaking several roles within the finance industry, thereby aiding him in defining best practice methods at all levels.
Darren set about gaining the necessary trading licences and by early 2004 he was operating as a sole trader from his back bedroom, with just one lender onboard. By the end of 2004, Darren had forged links with many other lenders and had moved into Cardiff-based offices early 2005.
The second trading year proved immensely successful as the business provided lenders with approximately £3.5 million of written business, excluding PPI premiums and fee charges. Darren Fry aims to develop the business further, estimating a four-fold increase on business in 2006.
His personal experience of working in the industry and that of his staff is one of the company’s greatest assets. Over the last three years, his team of highly experienced and senior level staff have established sound working relationships with brokers in the market and secured links with a number of lenders across the UK.
By taking a unique approach in paying commission to the brokers, Darren is confident that he will be able to beat competitors, and more importantly provide first rate service to the customer. The company’s approach to the mortgage intermediary market is simple: “we allow the mortgage broker to negotiate his/her commission on the first case to complete with us, on the day of completion with the Lender we transfer the commission immediately via internet banking”. This will not only allow the mortgage broker to earn a higher level of commission but will also provide them with a faster rate of service compared with that of their competitors.
Although larger companies represent a major proportion of those operating in the UK market, Prestige Acceptance is more than a match for its competitors while also offering a personal approach to servicing its clients.
The staff at Prestige Acceptance aim to find the best rate loan for their client each time. Although there is a flat fee for underwriting, the fee is quoted on an individual basis rather than a standard charge. As well as searching for competitive rates, Prestige Acceptance pays commissions to the broker even before they receive the commission from the Lender, which reflects their commitment to offering a top rate service.
