Prust says he has assembled a crack team from the secured loans and mortgage industries to set up the operation.
He says: “Excellent progress has been made, including in the infra-structure and staffing. But we can’t launch into the present market – first, we must see some signs of recovery.”
Prust insists that even if he has to wait until 2010, the venture will go ahead.
He plans to mirror the model used by Southern Pacific Personal Loans but warns the days of re-mortgaging sub-prime borrowers onto new sub-prime deals are over.
He says: “SPML was the most successful lender of its type of the past decade. I intend to duplicate that success.”
Prust is thought to be focussing on the secured loans market but will add mortgage finance to the proposition when conditions allow.
Mortgage Strategy understands a number of others in the sector are considering similar ventures but are waiting for funding to return.
John Parker, chief executive of the Finance Industry Standards Association, says: “There’s no doubt that lenders are interested in the secured loans market and it has a future. But funding is the problem – nothing will happen until the wholesale markets start to free up.”
Prust was previously involved in Concert Mortgages, a joint venture between Merrill Lynch and Abbey which fell through in 2007 when Abbey pulled out.