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Bluestone enters near-prime market

by Reporter11 minute read

Non-bank lender Bluestone Mortgages has announced its entry into the near-prime space with rate cuts of up to 225 basis points across its entire product suite.

The move into near-prime was hinted at earlier this year, with CEO of Bluestone Mortgages Asia Pacific business Campbell Smyth telling The Adviser that the acquisition of the APAC business by Cerberus Capital Management would enable Bluestone Mortgages to “actively evolve its product portfolio and service offering”, help it “focus on actualising a number of imminent expansion options that meet the demands of emerging sectors”, and place it in “an ideal position to aggressively capitalise on upcoming opportunities”.

Mr Smyth said at the time that these could include targeting near-prime borrowers and small-ticket commercial offerings as well as other asset classes.

As such, Bluestone has now announced that it has officially launched into the near-prime space and has made “ambitious” rate cuts to the Crystal Blue portfolio, which comprises full and alt doc products geared to support established self-employed borrowers (with greater than 24 months trading history) and PAYG borrowers with a clear credit history.


Speaking of the move, Royden D’Vaz, head of sales and marketing at Bluestone Mortgages, said: “The recent acquisition of the Bluestone’s Asia Pacific operations by Cerberus Capital Management has enabled a number of immediate opportunities to be realised — most notably the assessment of our full range of products and to ensure they fully address market demands.

“We’re now in an ideal position to aggressively sharpen our rates based on the new line of funding and pass on the considerable net benefit to brokers and end users alike.”

Mr D’Vaz added that the rate reductions have “significant strategic implications” as they place the company in a position to expand its operations into the near-prime space as a natural extension of its specialist lending focus.

“This comes at an opportune time as a growing volume of self-employed, PAYG and credit-impaired customers are affected by the tightening criteria of traditional lenders,” Mr D’Vaz continued.

“Unlike big banks, we don’t have credit scorecards, which means we’re able to assess every borrower based on their merits and individual circumstances. We’re not one-size-fits-all by any means, which is increasingly appreciated.”

Mr D'Vaz told The Adviser that he believed brokers were "crying out for more options in this environment" and had been telling Bluestone that it was getting "more and more difficult to get deals set from a mainstream lender".

"What was a deal six weeks ago at the mainstream lenders is not any more", the head of sales and marketing said.

"So, we saw an opportunity and wanted to seize that. And while we have always been very good at what we do in the specialist space, we now also have this competitive near-prime product.

"That is what happened by having this new owner, and the larger balance sheet. We can just go out and start doing these things. So, the small ticket commercial will be the next thing and there will be other things as well as we go along."

The move is being actively supported by the extension of the BDM, credit assessor and support teams to enhance access to decision makers to help brokers get more deals done, more often. 

Bluestone said that it is now focused on actualising a number of imminent opportunities that address current market demands, adding that the series of rate reductions are “the beginning of many initiatives that will enhance or expand the company’s portfolio”.

[Related: Bluestone Mortgages Asia Pacific acquired by US firm]

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