Mortgage News
Small building societies have big choice to make on advice – Dudley BS boss
Smaller building societies must use intermediary channels more effectively or bring the majority of mortgage sales in-house, the chief executive of the Dudley Building Society has said.
Dudley has removed postcode restrictions on its lending and appointed both Samantha Foxall and Gordon Rae as it looks to expand its presence in the intermediary market.
Jeremy Wood (pictured), chief executive of the society, said that smaller lenders need to make a decision on their future plans quickly.
“We see MMR as an opportunity to make a choice – build up our direct capability or develop relationships with intermediaries,” he told Mortgage Solutions. “For an organisation of our size we think the latter is the better route.
“We believe intermediaries will take the lions’ share of our new mortgage business and it is important to develop our business based on what a broker wants from us.
“Small and medium sized lenders will have to make a choice as direct advised channels are quite tough to implement given the costs of training, competency and supervision.”
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Wood added that smaller lenders could no longer afford to take on poor quality cases and that smaller mutuals must make sure case quality increases.
“We have good systems and have got to have quality business through the doors. There have been issues in the past and everyone here is aware that mortgage quality is sacrosanct, so no dubious cases.”
Dudley continues to offer part and part interest-only mortgages and Wood said that smaller building societies, which are able to monitor borrowers more thoroughly, could be the long-term home for these customers.
“We still do interest-only and are not shying away from it,” he said. “We think there is still room for interest-only and we have the capability to check repayment vehicles regularly to make sure they remain current.”