With three new networks established under her watch and statutory regulation just around the corner in October, it is fair to say Sally Laker is in for a very busy five months. But with more than 28 years’ experience under her belt, she is not fazed by the prospect and is relishing the new challenges regulation by the Financial Services Authority (FSA) has made possible.
From a relatively humble beginning, working for life company Royal Insurance in her hometown of Bournemouth in 1973, Laker has enjoyed a diverse career, which has seen her climb the professional ladder to become a prominent player in the mortgage world. Laker says: “Looking back, I never thought I would be where I am today. It is an ever-changing world and I love change. Working in the mortgage industry is so exciting and fast paced, changing on an almost continual basis. It is very exciting when you are running a company because there are always new challenges to be met and taking them to the next stage is the part I enjoy the most.”
Rather ironically she admits a career in insurance was not something she had envisioned for herself while at school, however she never regretted her decision to move into the financial services sector with Royal Insurance. Laker says: “At that time the main thrust of the business in Bournemouth was very much insurance-based. Large insurance firms had established head offices there and it was considered to be a good career prospect.” After spending four years with Royal, Laker moved onto her next role as senior consultant, mortgage and life, at Norwich Union, based in Wales.
It was this role, she claims, that gave her a solid grounding in mortgages. “It was an incredibly busy mortgage office and we were very much involved on the life and mortgage side. Being involved in the process from start to finish meant that I learnt huge amounts while I was there. Those were the days when to get a 100% mortgage you had to have a loan from an insurance company to top up the main mortgage. These were usually charged at exorbitant rates – way in excess of the mortgage. It was also at a time when Norwich Union was very competitive on the general and life side and endowment policies were the first choice to go with for mortgages,” she says.
In 1980, Laker was on the move again, this time charged with the responsibility of establishing a mortgage centre for insurance company Provincial in East Grinstead. Her job was to establish lending panels and develop relationships with mortgage brokers. Describing her role, Laker says: “When I took on the position, it was clear from the outset that someone with mortgage experience was needed to step up its mortgage business and establish what could now be considered an early form of mortgage club. Arranging the mortgage was the key to selling insurance products and Provincial wanted to tap into this. The knowledge I gained from my previous role at Norwich Union, regarding lenders and what they do was the key to setting up the centre, which allowed brokers to feed into it and place mortgages.”
Looking back, she admits the development of mortgage clubs has come along way since the early 1980s, when exclusive deals were unheard of and panels usually consisted of around four lenders. After working in East Grinstead for four years, Laker transferred to Provincial’s Bournemouth office to spearhead the development of another regional mortgage centre.
After taking time out from her career to raise a family, Laker joined Mortgage Intelligence (MI) in 1996, where she worked as a sales manager until Close Brothers, an independent merchant bank, acquired the company and promoted her to sales director. In 2000, she became its managing director. Describing her remit at MI, Laker says: “My role at the company was quite exciting. It was a new start up primarily dealing with brokers, which was the element that I enjoyed the most. We wanted to provide brokers with an all-win package at a time when there wasn’t that much around, so they could benefit from lead-generation, a range of products and slightly higher procuration fees. It was well received and I am pleased to say that we still have some of our original members.”
Under her guidance the company has grown from strength to strength, having started with 350 members it now has over 7000 mortgage intermediaries on its books. Laker says it was the financial clout of Close Brothers, which helped the company achieve its growth volumes over the last seven years. “The acquisition presented a great opportunity to take the business to the next stage, enabling us to move things forward at a much faster pace than we would have originally done. We opened out Mortgage Intelligence, enabling brokers to access our panels without having to be part of our subscription base,” she says.
Subsequently, Laker has also watched her workforce grow from six employees in 1996 to over 70 in 2004. She says: “I have always enjoyed being involved with mortgages. I have had the opportunity to see something develop from the beginning and I am pleased with the reputation we have in the market place. We all work very much as team to keep that going now and for the future.”
Laker says that the company had now entered a new phase in its strategic development, after launching three networks earlier this year. The Spirit Network is available to brokers wanting to become appointed representatives of MI, Vantage Network is available for directly authorised brokers wanting to tap into its support service while Elan Network is available to directly authorised brokers wanting to use products in the same way as a mortgage club. Laker says: “Regulation gave us the opportunity to establish our network propositions so we could offer a choice of routes for all brokers, and remain a one-stop shop for whatever need required. The networks have been successful and have grown enormously.”
She says the company had spent £1.3m building its proposition, focussing on its IT system to ensure easy use and comprehensive compliance. “We currently have people joining our networks, but we also have a big pipeline of brokers that are at different stages of their decision making, unaware there is an application process to go through that can take up to eight weeks before becoming an AR of our Spirit Network.” Laker admits this is happening across the board, and is causing growing concern among networks that brokers could leave everything to the last minute. She says: “Any network taking responsibility for brokers will require referencing and a whole host of information which takes time to process and this is a worrying factor for all networks. I think in some cases brokers think they can register and in a day or so be up and running, this is not the case, there are just as many forms to complete as if the broker were to go directly authorised.”
She says it is almost inevitable that there would be a last minute rush by brokers to join a network. “We are doing absolutely all we can do to encourage brokers to think about this now. If everyone leaves it until the last minute, it will be difficult for any network to turnaround an application in such a short amount of time. To a certain extent, the mortgage industry, as in the lenders and networks, have lived and slept regulation for almost two years working and planning it, but from a broker perspective, reading about it is not necessarily realising all that is ahead and the timescale involved. The feedback we are getting is that brokers are still unaware that there is sense of urgency.”
Laker acknowledges that regulation will create uncertainty in the market, for lenders, brokers and networks but believes October is just the beginning. “We will start to see some real changes six months to a year after regulation,” she says. Speculating on the future of the market, Laker also predicts the demand for housing across the UK would continue to drive house prices up, forcing lenders to deliver even more competitive products.
She concludes: “Once you are right in the midst of mortgage broking you know what is a good product. It is like anything, if you know the market you are in, you are always hungry for the next sexy deal.”
