"More and more customers are coming to brokers in a panic"
The mortgage market is going through a turbulent period; with products being pulled at short notice, and reintroductions happening at a slow rate. It is a challenging time to be a broker.
Clients can be impacted significantly by these fast changes, often detrimentally, and brokers are having to work longer and more unsociable hours to make sure applications get in before lenders’ deadlines.
Mortgage Introducer has spoken with a broker to uncover the challenges advisers are facing on the ground, in light of the financial disruptions their customers are facing.
Panicked customers
Kim Balasubramaniam (pictured), senior mortgage broker at The Mortgage Mum, said she has seen more and more clients coming to brokers in a panic, worried about what the future will hold for them.
“We see our role as bringing a calming presence, making them feel heard, and working with them to find the solution that is right for them,” Balasubramaniam said.
This in turn, Balasubramaniam said, makes customers feel less fearful, as they have gained some control. Indeed for some clients, Balasubramaniam said, it may not even be the time to make a change or put an application in, they may just need to have a conversation and be aware of their options.
She believes being upfront about the current challenges with a client is key, as is ensuring they are as prepared as possible.
“I tell all my clients at the moment that rates are changing daily, sometimes with very little notice, and so it is imperative that if they want to fix in a rate that is currently on the market, they need to ensure that they have all their paperwork in order and are prepared to make decisions quickly,” she said.
Avoiding cutting corners
While imparting knowledge and advice to clients quickly is of the upmost importance for a broker, Balasubramaniam said advisers must ensure that in this type of market, no corners are cut and the advice given remains measured and calm.
“Clients come to us looking for the ‘right’ answer, and ultimately that answer is going to be different for each one, so although we are feeling the pressure from the seemingly never-ending rate pulls and changes, we must not allow that to impact our advice,” she said.
These fast-moving product withdrawals, Balasubramaniam said, are significantly impacting the way brokers work.
“There have been many late nights battling with lenders’ systems to get an application over the line, and there will be some instances where it is just not possible,” she said.
As such, she said that managing the expectations of clients right now is key, as well as ensuring they understand that until the application has been fully submitted, the rate is subject to change.
With Consumer Duty drawing ever closer, brokers must also consider ‘fair value’ for their customers; meaning they will need to comply with strict regulation ensuring they are offering their customers efficient service. The Financial Conduct Authority (FCA) has utilised much regulatory capital in its inception of Consumer Duty, with many industry figureheads believing communication will be the best approach to managing the transition.
There are difficult conversations to be had, but Balasubramaniam believes if brokers approach these with care, understanding and empathy, they will be all the more well-received.
“It is a turbulent time for sure, but I believe we are needed now more than ever,” Balasubramaniam concluded.
What difficulties have you experienced operating in this current challenging marketplace? Let us know in the comment section below.
