The product has a maximum advance of £15,000, a maximum term of 60 months and some adverse credit will be accepted, so long as the trend is improving. Currently, the highest available LTV for a secured loan is 85%.
Lifestyle loans will open up the market for a section of would-be borrowers that are currently in a credit void, that is, those that cannot obtain a secured loan due to LTV restrictions and/or they do not qualify for an unsecured loan because they have some adverse credit history.
Y3S says a typical client would be a couple that has purchased a property in the last year or so, and needs finance to carry out home improvements.
Only customers that have full-time employed positions will be considered and a comprehensive income and expenditure assessment will be carried out to ensure the customers can afford to repay the loan.
Y3S says that it will offer the product to its registered introducers first to trial the products features and will roll out to the wider market early next year.
Matt Cottle, group director at Y3S, says: “In 2010 we have been delighted to see the market develop beyond what we had imagined it would.
“Our Lifestyle loan will help more people to literally improve their lives, by allowing them to consolidate credit cards, carry out home improvements or buy the new vehicle they have been unable to because of tight lending restrictions. We have an initial funding line of £10m, enough to complete 100 loans per month for a while. Further funding will follow a successful initial period.
“Y3S Loans is committed to increasing its share of the loan packaging industry for the intermediary market. For our introducers, the Lifestyle loan product will generate £300 commission for a £15,000 loan, adding a useful revenue stream to a currently restricted portfolio.”