State Bank of India will offer deals via brokers
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State Bank of India plans to launch a range of buy-to-let and residential mortgages in the UK through brokers next year.
India’s largest bank launched into the UK mortgage market last week with a buy-to-let product.
It is only offering it direct through its UK branches, but a spokesman says it will start to distribute through brokers at a later date.
The lender, which also has Financial Services Authority permission to offer regulated mortgages, plans to launch residential products in 2012.
Speaking about its buy-to-let deal, a spokeswoman for SBI says: “Distribution will be via SBI’s UK branch network and we will add IFAs and brokers to our network in the second phase next year.
“SBI also has plans to launch a residential mortgage in 2012.”
She confirmed these will also distribute through brokers.
For its buy-to-let product it is offering a tracker rate up to 60% LTV at base rate plus 3.99%.
The term runs for between five and 25 years with a possible interest-only option, and is available on loans between £50,000 and £1.5m.
The product has a £150 booking fee and £1,990 arrangement fee and no early repayment charge. It says that depending on the credit quality of the borrower and size of the loan, the loan criteria and LTV will be flexible.
The Indian bank already offers savings accounts and investment products in the UK.
SBI, which is 59.41% owned by the Indian government, is the 50th largest bank in the world and is believed to be the first Indian bank to enter the UK mortgage market.
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Readers' comments (9)
Ketan Yadav | 26 Sep 2011 8:26 am
Welcome new indeed for large BTL purchases as they are the only lender offering such a large loan at this rate for brokers.
Nat West and RBS are the only others who are offering loan sizes of this amount - but direct only and at BBR + 3.39%. The criteria will be the deciding factors.
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Anonymous | 26 Sep 2011 9:39 am
You do not enter BTL market requiring investors to put up 40% deposit with the UK and the world economies as they are.On top of that you hefty product fee.
SBI needs to substantially reduce the product fee and increase its LTV to at least 75% for it to have an impact.
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Ancient Wisdom is....a mortgage broker in N3 | 26 Sep 2011 10:20 am
to Anon: 26 Sep 2011 9:39 am
There are alot of clients of mine who have more than 50% equity in their property, and affluent have over 50% deposits. This isnt designed for the mass market, or kick start the economy - its for those that can and will. If other lenders dont step up to the mark, then they lose. Its a very welcome development and the fee is very reasonable compared to other lenders. Alot of my clients are paying 2.5-3.5% fees with TMW and Kensington and others - and they need to reduce fees more than anyone.
Sounds like you are a competitor - with lack of competition.
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Kop | 26 Sep 2011 10:38 am
Fees are in line with (B2L)market - you need to increase the ltv to 75% to compete
Also will your call centre be in the UK?
Walk on
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Dan McGeehan | 26 Sep 2011 12:48 pm
the product fee will be one of the lowest in the BTL market with the majority charging around 2-3% of the loan amt. Any new entrant regardless of how much market share they are targetting is welcome.
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Anonymous | 26 Sep 2011 2:05 pm
My guess is (knowing who works there) criteria will be similar to that of Platform.
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Shaks | 26 Sep 2011 3:48 pm
Any new development in lending is welcome but to have real impact and market share we need a lender with bigger balls who can comfortably go to 75% ltv and charge proportionate fees with no minimum inome criteria to knock TMW off the block.
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Ancient Wisdom is....a mortgage broker in N3 | 26 Sep 2011 4:27 pm
Brokers should stop complaining - there's another lender on the block and like HSBC - they dont want to take risks - that is sound lending policy.
There are plenty of deals at 75% - if your willing to pay the fees - and surprise surprise, the likes of TMW are doing very well out of it so no need to change that.
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jools | 27 Sep 2011 2:45 pm
....and their call centre will be in Halifax!!!
I'm here all week.
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