With the current turbulent times in the mortgage market, the strength of any business support company lies in its ability to work with its customers, until we see calmer waters.
This requires on the part of the Network, a degree of flexibility, to have a realistic view of the marketplace and keep up to speed with product and criteria availability. Now more than ever, a working partnership between distributor and intermediary is of key importance when meeting the needs of the end consumer.
In the past, lenders have been willing to consider applications on cases that don’t necessarily meet their criteria to the letter. This does not appear to be the case anymore partly because of the securitising issue and partly the need to manage risk. Lenders and those investors that either buy mortgage books, or have money in the bank itself, want to know exactly who the bank is lending to and not learn than a proportion of the book is written off criteria.
For the non-conforming market, the packager has an important role to play in helping the broker get the right deal for their client. The sub-prime market has not disappeared; it is simply harder to get the product that meets the consumer’s needs.
The combination of packager and mortgage desk working together gives the broker access to an up to date research tool that can not only identify potential client solutions but can also highlight how long the deal is available for and what information needs supplying to get the case through. Why should the broker need to maintain 20 lender relationships in this ever changing marketplace, when a distribution company such as Pink can act on their behalf.
Going direct to lenders may suggest to the broker that they have some degree of increased control but that does put a lot of pressure on them to keep in tune with the rate and criteria changes that lender is making. Add to this the delays in some products being made available on sourcing systems, we have seen products issued and withdrawn before they have even made it onto any computer screen, and you can see the importance of discussing a case with a knowledgeable person.
So what else can the Network help with in the current conditions? Maximising income opportunities with consumers becomes key, where core mortgage volumes are falling, there is more time to address protection and insurance needs. There may have been instances where you advised a consumer that a follow-up visit would be arranged to review the protection needs.
Under the Treating Customers Fairly regime, this is a commitment the intermediary has to fulfil, if it has been promised, then it must happen otherwise there could be a complaint or even a compensation claim. This is therefore a good time to review diaries, past sales and existing client banks for follow up visits to talk about such things as Life Insurance, Critical Illness cover and Home Insurance. Each of these financial solutions presents an opportunity to supplement any fall in income from core mortgage business whilst meeting the needs of the customer in full.
The benefit of a network such as Pink is in the business relationships we have not only with lenders but suppliers in other areas of the financial services world. We not only work to provide training and sales skills, but also to improve processes to make advising on these products easier.
Offering a wide variety of suppliers to our customers ultimately means our intermediary customer base has a number of alternative business opportunities they can explore which helps protect them whist the market goes through its period of instability.
When will this all end and we return to some sort of normality is anyone’s guess at the moment, what we do know is that change has happened and we are unlikely to return to a market place that was the same as in the first six months of this year. It is up to Networks to make sure as many of our intermediary customers come through with a stronger business model and a greater degree of flexibility in their consumer base.
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