With the Derbyshire set to launch its standalone brand Salt on Monday a number of industry experts have aired their views on the subject.
Linda Will, managing director of Accord Mortgages, says: “We were the first to set up a subsidiary to deal with core prime bus as well as sub-prime. What a lot of people have done is used the subsidiary to go into non-core markets and not endanger the main brand.
“But as I understand it, The Derbyshire was already dealing with people on the sub-prime.
“It seems a lot of packagers have become branded lenders, is the aim now that lenders become branded packagers?”
Salt will be dealing with near-prime to heavy sub-prime and will be available though some packagers, although the aim is for it to be accessed to intermediaries directly. Packagers that have been confirmed are Abacus, Praxis and Pink Home Loans.
Another industry souce says: “Sub-prime is a sector of the market where you can maximise profits.
It is obviously testing the market and seeing the appetite for the products. If memory serves correctly, The Derbyshire did offer a range of sub-prime products in market, which it then withdrew, so it had a go at it and liked what it saw.
“A number of societies have a similar arrangement and I think it will be a trend that will continue.”
Martin Reynolds, head of sales at BM Solutions, says: Another week another lender. This shows the market is still attractive and vibrant. Welcome to the fold.
There has been no comment from The Derbyshire.