Magellan launched into the market in August last year with a product range aimed at supporting borrowers with a previous history of heavy adverse credit to repair their credit record.
But with rates of 8.52% some commentators had been sceptical as to the viability of the range.
However in a move which Sinclair branded as “very good news” the credit repair lender has now cut its rates to a more palatable 5.42%.
Sinclair said: “This rate change from Magellan will assist brokers to look at their proposition more seriously.
“However, the product still needs to be used carefully to ensure that customers meet the criteria.”
Sinclair warned brokers that they need to ensure customers understand the nature of Magellan’s proposition.
And he added: “Brokers will still need to help customers understand the link to LIBOR on which this product is based.
“But Magellan’s move is very good news for the industry.”
As well as cutting its rate Magellan has also made a number of criteria changes including raising the maximum loan to value to 75% for borrowers in debt management plans and allowing its fees to be added above the maximum LTV.
Mark Snape, managing director lending at Magellan Homeloans, said: “Magellan values the support of Robert and AMI.
"It is an influential and important trade body so I am looking forward to working more closely with Robert and his members.
"Together, we need to help brokers understand the unique features of the Magellan proposition and how they can be used to offer assistance to people who believe no mortgage solution is currently open to them.”
