Broke SMS is still on the lookout for investors

Solent Mortgage Services is still on the lookout for investors after calling in the administrators last week.

Ian Balfour, sales and marketing director of SMS, says that while the firm is trading through the administration process it would still welcome interest from potential investors.

Mortgage Strategy understands that SMS has put in place measures to guarantee brokers’ proc fees but is unsure whether these arrangements will still be valid now that the firm has gone into administration.

SMS chief executive Paul Robinson launched the firm in 1989 and geared the business towards rapid growth.

But when the credit crunch hit, the level of completions at SMS fell and the firm found it was unable to support its investment.

GE Money Home Lending also fell victim to the credit crunch last week and increased its rates and completion fees.

It blamed exceptional volatility in the global financial markets for the move.

Roger Morris, managing director of em-financial, says the changes will be a blow to packagers.

He says: “The product changes will be a step too far for many of them. We are contacting our brokers and having to re-credit score their cases.

“Platform has increased its resources and is working overtime to try and help us place some of the deals.”

But GEMHL was quick to reassure packagers and brokers that its criteria hike does not signal the beginning of the end for the firm.

A spokesman for GEMHL says: “I can categorically confirm that we have no intention of withdrawing from the market.

“From our point of view, we have a powerful franchise which we are keen to protect in the long term.”

He adds: “We see ourselves as a long-term player in the UK specialist market.”