The club has agreed with Bank of China to distribute several mortgage products, initially via appointed representatives of Legal & General Partnership Services.
The products are lifetime trackers at bank base rate plus 2.5 per cent for residential borrowers, and base rate plus 3.5 per cent for buy-to-let borrowers. The mortgages will be processed by Connect, after which applicants will be invited for an interview at one of Bank of China’s five UK branches.
L&G managing director of housing Gary Burchett says: “The entrance of new lenders into the UK mortgage market is going to shake things up because it will give a boost to the overall supply of credit and existing lenders something to think about. For brokers and their clients, it has got to be a good thing because funds have been severely restricted. If you lend prudently and to the right people, there’s no reason why a lender can’t generate quality business through our high quality network of advisers.”
Bank of China is currently the third biggest bank in the world. It also recently revealed it was offering loans through four UK packagers – Savills Lending Solutions, Connect Mortgage Group, Solent Mortgage Services and Complete Mortgage and Loan Services.
Savills managing director Mark Harris says Bank of China’s entry into the UK market proves that there is still opportunity for new lenders in this country.
He says: “This is a good sign for the market if a big bank like Bank of China is willing to lend. It’s too early to say whether it will stay in the market, but its range has gone down well and is reasonably competitive.”