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Right now, we’re all being battered by the challenges of a volatile economy and a squeeze on our finances, thanks to the rising cost of just about everything, along with rising interest rates.
Brokers are facing enormous fronts of high pressure, with demand soaring as panicked borrowers rush to remortgage. Many are incredibly busy, battling to place cases as lenders keep having to pull their rates to reprice in line with market moves. Brokers don’t just need to keep on top of all the rate changes and product withdrawals going on, but also need to offer advice on a future economic environment for which the forecast is unclear.
In these difficult conditions, the relationships we lenders and brokers have built up with one another over the years are particularly valuable. If there is one thing the pandemic taught us, it was the merit of working together, sharing knowledge and experiences, and helping one another as best we can. As a result, the mortgage industry came through that period more united and more efficient, with a range of tech solutions improving our working processes and deeper relationships than before.
We need to keep applying the lessons we have learned over the past two years. As lenders, it is vital that we keep the lines of communication open, and are as transparent with brokers as possible, giving as much notice as we can about product withdrawals and repricing, and being brutally honest about SLAs (service level agreements).
There’s no denying that lenders are experiencing service issues and having to crack the whip and work the underwriters very hard, but we are still not back to our target service levels as an industry and may need brokers’ forbearance for a bit longer.
Martin Reynolds, chief executive of SimplyBiz mortgages, gives the following viewpoint: “Brokers understand that the constant repricing and axing of products over the past four months has been driven by volatility in the market. But in order to be able to plan and manage customer expectations, we need as much notice of withdrawals as possible, and for lenders to be completely transparent about their turnaround times. In an ideal world we would also welcome some reasoning from lenders around the decisions to pull or change rates. We may not like the explanation, but at least we would have some context which could then be passed on to the customer.”
As lenders, we also need to make sure our processes are as efficient as possible, as process can of course impact the speed with which cases flow through the pipeline. It is useful, for example, when lenders arrange valuations on application (with fees paid), which helps get offers out the door. But it is also a huge help for us if brokers submit all of the correct essential documents first time. This might feel like a big ask as it may take a bit more time upfront, but getting it right first time really helps get a case through as quickly and smoothly as possible.
Genuine thanks are owed to hard working brokers striving to provide the best advice and secure the most appropriate deals for their customers in this constantly changing market – and at a time when many customers’ financial circumstances may also be suffering from the tightening squeeze on incomes.
In particular, intermediary-only lenders, who rely on their brokers, are very grateful for the ongoing support and patience we are experiencing.
Amid all this uncertainty, brokers can rest assured that established mortgage lenders will continue to offer a safe haven for the customers brokers bring through the door, we simply ask that the intermediary community bears with us while we work though the current headwinds.
There are glimmers of light on the horizon! There are signs that the markets are starting to stabilise now, having accepted that economic growth will be lower this year than immediately post-pandemic and factored in future rate rises. The rate rises themselves do not seem to have dampened demand for mortgage finance overall, which is good news for brokers and lenders alike. And there is plenty of innovation afoot, particularly across the specialist sector.
So, I am hopeful that openness and honesty on the lender’s part, combined with care on initial submissions from brokers, supported by the strength of our partnerships, will carry us through to calmer waters.
Adrian Moloney is group intermediary director at OSB Group
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