For the last two years, the subject of technology and how it can improve the way lenders and brokers do business has dominated the mortgage market. Hype and speculation have reigned supreme.
But, in the real world, uptake of technology can be, at best, described as fragmented. Yes, a growing number of brokers are now online and promoting their services on the internet and yes, brokers are now using some of the many sourcing systems available. But no one solution is ideal. Useability, coverage and added value services such as insurance and conveyancing links all vary between providers and even when the right loan is sourced, the broker will probably have to contact the lender for further product information and to make an application. The process is still far from seamless.
This ‘seamlessness’ is the objective of everyone in the mortgage market ‘ the lenders, brokers and, not least, the borrowers .
Thanks to two announcements made this month, we may now be a step closer to this. IFonline has announced its acquisition of Trigold, marrying its online transactional capabilities with Trigold’s desktop sourcing system while Halifax, Nationwide and Alliance & Leicester have all purchased a stake in Mortgage Brain with a view to developing an electronic common trading platform.
Critics have suggested this group of lenders are forming something of a cartel, by taking such a large stake in Mortgage Brain, but with more shareholdings up for grabs, no one lender stands to gain an unfair advantage. All in all this should be viewed as a positive step forward for the mortgage industry. At last some of the major lenders are taking e-commerce seriously, validating everything companies like IFonline and Mortgage Brain have been trying to achieve in recent years.
So what does this mean for you, the broker? With a bit of luck, brokers should soon be able to source the right mortgage and click on a mouse to apply, allowing lenders to get cracking on the case straight away. Case-tracking would, no doubt, be worked in to help brokers monitor the progress of the application online, without hanging around on the phone. Assuming all goes to plan and the new systems are user-friendly, brokers should be able to operate a more streamlined and cost-effective business and provide clients with a faster service.
The technology is now in place to make e-commerce a reality. But to take off trading platforms need the support of lenders. Three have already made a commitment by investing in Mortgage Brain, hopefully more will follow their lead. Most lenders do now have the capability to trade electronically. Yet few brokers will want to contact each lender website each time they want to apply for a mortgage, nor do they want to remember the numerous passwords this would entail. Accessing all products via a centralised portal will be much more efficient for the majority. It is time for lenders to get behind these trading platforms to make electronic trading a reality ‘ as everyone stands to gain.
But it is not just the job of the lenders to make electronic trading work. Brokers now need to get involved and let lenders know this is what they want ‘ the more brokers use these systems, the more lenders will support them. Responsible for half of all mortgage sales in the UK, brokers are a distribution channel that lenders cannot afford to ignore.