Advisers aren't just for the bad times…
It’s often thought that brokers show their worth in the tough times, when escalating rates make anxious borrowers ever more reliant on their advisers for guidance.
But, arguably, the value of brokers shines through during periods when rates are being slashed, as they are now, in the aftermath of the Bank of England’s recent base rate decision and the resulting plethora of lenders’ rate cuts.
Certainly, it seems that brokers are increasingly valued by consumers - the turbulence of the market in recent years, and the need for advice, appears to have enhanced their wider reputation with the public.
The Intermediary Mortgage Lenders Association (IMLA) estimated that intermediaries’ share of lending would rise to 89% in 2024, and over 90% in 2025. Furthermore, it predicted a 4% rise in broker business volumes next year, reporting that their advice would continue to be vital for the borrowing community.
And so it seems… Oliver Fare, property finance broker at Fox Davidson, finds he is in increasing demand as rates fall.
“As a mortgage broker, my value is particularly evident when mortgage rates are regularly being revised down,” Fare (pictured left) told Mortgage Introducer. “In such a dynamic environment, it’s easy for clients to feel overwhelmed by the constant fluctuations. My role is to stay on top of these changes, providing clients with timely, expert advice to help them navigate the market effectively.”
As the market starts picking up, people are motivated to act, Fare explained, whether they’re first-time buyers trying to get on the property ladder, homeowners looking to refinance, or investors expanding their portfolios.
“Each of these clients need prompt, informed advice, which means I have to manage my time efficiently to ensure everyone gets the attention they need,” he observed.
“Some assume that because rates are falling, they can easily navigate the market themselves. However, the opposite is often true—the faster the market moves, the more complex it becomes. Without expert guidance, clients might miss out on the best deals or make decisions that aren’t aligned with their long-term goals.”
Fare believes there is a need for more education around the value of using a broker, especially during times when the market appears favourable.
“Many consumers don’t realise that low rates don’t automatically equate to the best deal,” he said. “Factors like fees, loan terms, and the risk of future rate increases are all critical considerations that a broker can help navigate. Rates can drop quickly, but knowing when to lock in a rate and anticipating future market trends are areas where my expertise can make a significant difference.”
How busy is the mortgage market currently?
Steve Mears, director of Steve Mears Mortgages, is reporting brisk business too, and believes brokers are adding massive value to clients in the current marketplace. It can suddenly become unexpectedly busy overnight, he said.
“July can be quiet, as school holidays, etc. kick-in, but this one was the busiest month I can remember for a long time,” noted Mears (pictured centre). “Everybody has an opinion on interest rates nowadays, but nobody really can predict further than next week, with what’s happening in the world, as so many things can affect it.
“Halifax dropped their rates four times in 10 days at one point, each time by a small margin, but every little helps, as they say! Swap rates are what the lenders work with as the true cost of borrowing, and these are so volatile and have been for a long time.
“Lenders often also withdraw rates when they get busy, and others sometimes have to follow suit. This creates a very confusing arena to advise in, as clients are understandably nervous and keen to get the best rates.”
Mears believes that the vast majority of borrowers turn to brokers for an easier mortgage-seeking experience.
“It is such a stress dealing with a lender direct,” he said. “There is a ton of information on the web, but no advice -that’s what we provide.”
Read more: What does a rate war mean for the mortgage market?
What makes a good mortgage broker?
For George Sanford, specialist mortgage adviser at Vibe Finance, the role of a good broker doesn’t stop after the initial research, case submission or in some cases even at completion of the loan. He is continuously reviewing all live cases to see if a client can benefit from a lower rate or reduced fees, but in this rapidly changing market, the devil is in the detail, it seems.
“Not only do we need to consider the change in rates but the associated cost of changing,” shared Sanford (pictured right). “We have seen an increase in lenders charging fees for product changes, some as high as £750. This can rapidly eat away any benefit on a smaller change so it’s not always as simple as new product is better.
“Naturally when rates drop we see increased activity from investors who have previously assessed deals that didn’t work at that time but may now stack up. It is always nice to be able to deliver good news of rate reductions to clients in times like this, especially after having to work so hard to secure rates from a rising market so recently.”
Gindy Mathoon, mortgage advisor at Create Finance, meanwhile, believes advisers offer a simple advantage in a volatile market.
“Brokers will always hear about the lender rate reductions before the borrower does,” he suggested, “therefore a broker can ensure the borrower benefits from any future rate reductions, prior to the loan starting.”
Gindy Mathoon was awarded as the Best Mortgage Brokers in the UK. Read the full winners here.
