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Rethink required to boost broker market share further

by: Richard Adams
  • 06/09/2011
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Rethink required to boost broker market share further
Recently, there were some encouraging figures for intermediaries with the news that its share of mortgage business has improved during quarter two compared to quarter one.

The volume of both first-time buyer and home move cases rose by 25% and 24% respectively, meaning that advisers placed 64% of all first-time business and 55% of home mover loans.

Given the upheaval that the market has been through recently, positive results like this should give everyone a boost.

Of course, we are all aware that lending levels are not as strong as we would wish them to be.

However, we have recently seen a move back towards intermediary distribution from some lenders with a growing number of products and opportunities in a number of areas.

Buy-to-let product growth in particular appears to be strengthening and we are seeing movement in terms of both LTV and criteria as more lenders start to dip their toes into that particular market.

We are even seeing lenders pushing LTVs up to 100% and, while this type of lending will be limited, it means that some first-timers may now be able to secure finance that was closed off to them just six months ago.

Whether this represents responsible lending is perhaps a debate for elsewhere, but it does prove that some lenders are much more willing now to move up the risk curve, particularly in terms of maximum LTVs.

The proof of the pudding will be in the eating in terms of actually lending at these levels, but one suspects that some lucky individuals will be able to secure these deals.

The point for intermediaries is to actively re-engage with those clients who may not have been eligible a few months ago and to make sure their services are marketed effectively to potential new clients who may have no idea that the mortgage market is not as tight as it once was.

Effective marketing can come in many shapes and forms; one man’s trash is another man’s treasure and for every practice that spends thousands each month on leads there will be another that operates purely by word of mouth and referral.

In our experience, it is important to have fingers in pies when it comes to marketing activity. By all means continue to use what has worked for you in the past, but the market is so fluid that other sources of clients may well be lost if new methods are not embraced.

We believe that increasing the business profile as a whole should be a focus alongside more targeted methods such as email shots, advertising, direct mail, etc, while a clear and consistent brand style is vital.

If a brand is instantly recognisable, then the chances are that after repeated viewing this will lodge in a potential client’s mind and they will seek out the firm’s services.

Our other point of advice to firms is not to be afraid to embrace the modern.

This could be using social media to target a younger client base or using modern, or indeed, quirky visuals and branding to set yourself apart from competitors who may not have changed their marketing material for a considerable length of time.

As with anything, getting the right mix is important.

Don’t dismiss activity that was tried once and failed; perhaps shift the emphasis or the tone or the design and the results may be pleasingly different.

At the same time, do not throw good money after bad – it may well be that your client base is not logging on to Twitter every hour or so; instead they may be walking past your office every day.

Therefore, explore the potential but also actively communicate with your existing client base. From these two areas, firms should see the benefits and we believe intermediaries will continue to grow their mortgage market share.

Richard Adams is managing director of Stonebridge Group

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