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The move is designed to equip brokers with additional options as more borrowers are declined for new credit facilities despite holding historically high levels of property equity.
Midkey operates as a National Consumer Credit Protection (NCCP) compliant lender and delivers home equity release solutions, structured with no monthly repayments and available as either a first or second mortgage.
The lender positions its offering for borrowers across all age groups who have accumulated significant housing equity, but are unable to access further funds through traditional income-based lending assessments.
Specialist Finance Group’s (SFG) decision to onboard Midkey reflects an expanding market gap between standard serviceability metrics and rising property equity, particularly as higher interest rates continue to constrain borrowing capacity.
SFG general manager Blake Buchanan said brokers throughout the group’s network were increasingly supporting clients who did not fit conventional lending models.
“In a challenging property and lending environment, we are focused on ensuring our brokers have access to lenders that can solve real client problems and Midkey is a new way to achieve this,” Buchanan said.
“We are seeing more scenarios where people have strong equity positions, but are being declined for additional funding due to rigid cash-flow-based serviceability assessments. This partnership with Midkey ensures brokers have a credible alternative for those situations.”
SFG brokers will be able to refer qualifying clients to Midkey from mid-February. The agreement is Midkey’s first aggregator partnership in Australia.
The addition provides brokers with an alternative pathway for clients who might otherwise be forced to consider asset sales, downsizing, or postponing key financial decisions due to limited access to traditional finance.
Equity release solutions have been gaining traction among lenders as a means to access untapped cohorts of the borrowers. Earlier this month (5 February), non-bank lender Clinch launched a new short-term equity release product targeting later-life home owners.
Midkey co-CEO Richard Young said the broker channel was central to addressing what had become a common challenge for borrowers.
“Brokers are increasingly seeing responsible borrowers declined by banks for new capital, even when they have built large stores of wealth in their homes,” Young said.
“Our no monthly payments loan was developed for this exact cohort. We are thrilled to have partnered with SFG so more brokers can offer a solution that reflects the financial position many households now find themselves in.”
In December, Midkey secured a $100 million funding facility from global asset manager Insight Investment to support the expansion of its Australian loan portfolio.
Midkey customers with an existing mortgage can unlock up to 30 per cent of their property’s value, while debt-free borrowers can access up to 35 per cent.
[Related: Low-deposit loan data flags untapped market]