Bundle combines mortgage and legal services under one roof
Fintech mortgage lender Gen H has launched a new product range that promises to provide first-time buyers a seamless homebuying experience by combining mortgage and legal services under one roof.
The lender, also known as Generation Homes, said customers could save thousands of pounds on their mortgage from today, March 15, with the premium service available with exclusive lower interest rates.
It can be obtained by customers who apply to Gen H directly, as well as 11,000 brokers on the Gen H panel.
Gen H’s first-time buyer bundle includes access to a premium conveyancing service provided by Gen H Legal, exclusive reduced mortgage rates on two-, three- and five-year fixed rate products at loan-to-values of up to 95%, and free valuations.
These first-time buyer bundle, with rates lower by as much as 0.35% than Gen H’s standard range, is being advertised as the first of its kind for the UK mortgage market.
“The launch of the first-time buyer bundle represents another mortgage market first for Gen H,” said Pete Dockar, commercial director at Generation Home. “This exciting development means that our broker partners and customers can finally experience a new standard for conveyancing from the Gen H team they already know and trust.”
Gen H also announced plans to launch similar homebuying bundles through this year to support home movers and remortgagers.
“The UK housing market is not fit-for-purpose,” remarked Will Rice, co-founder and chief executive at Generation Home. “Consumers have to navigate a minefield of different service providers to achieve their homeownership goals and the process is loaded with complexity and unnecessary cost.
“The launch of our first-time buyer bundle is a big step towards simplifying this and returning value to our customers. We hope that other lenders will embrace this approach, and join us in driving the housing market change that consumers are crying out for.”
Brokers react to Gen H’s new offering
For Rhys Schofield, managing director at Peak Mortgages and Protection, combining mortgage and legal services in a first-time buyer bundle may be a good idea in theory, but there are potential pitfalls.
“The devil will be in the detail, too, as you may still be left with more in your back pocket going to a top sourcing lender and paying for your own conveyancer, where you can actually choose a firm based on their reviews and service rather than having a particular firm forced on you,” Schofield remarked.
“The other pitfall I can see is what happens if a case ends up not going through with Gen H, as having to change lenders happens more often than anyone cares to admit. Does the legal process have to start again? That could add months onto a property transaction. I commend Gen H for trying to make things easier for first-time buyers, and this will grab headlines, but I don’t think it’ll be easy to pull off.”
Scott Taylor-Barr, financial adviser at Carl Summers Financial Services, said his first response was also not positive.
“The mortgage adviser and conveyancer are the only two parties that are employed by the buyer and so, our responsibility is to them,” Taylor-Barr pointed out. “My concern with this is that the conveyancer is now employed by the lender, so whose interests are they looking out for? The first-time buyer, or the lender that is paying them?”
Lewis Shaw, owner and mortgage broker at Riverside Mortgages, agreed, saying that the point of legal representation is that it’s unbiased and independent of an estate agent and mortgage lender.
“Blurring these lines is not something I would be comfortable with, and it’s certainly not something I would be advocating a client did,” he added.
Austyn Johnson, founder at Mortgages For Actors, was more positive about the new Gen H offering.
“Lowering interest rates, free valuations, and keeping the legal things in-house will hopefully mean a quicker service, less chasing, and more transparency,” Johnson said. “What’s not to like? I can see Gen H being the go-to lender this year.
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