According to new data from sourcing system Mortgage Brain, the number of mortgages available to intermediaries has jumped by 108% over the last two years. An additional 5,172 products have been added to the market since the end of June 2015. Buy-to-let deals have seen a particular spike, rising by 149% over the period.
Mark Lofthouse, chief executive of Mortgage Brain, said that the rapid increase meant a significant improvement in the range of options available to brokers and their clients.
“I would rather have one product that has the features my client needs, than 5,000 products which don’t.”
However, some brokers have warned that rising product numbers are more of a hindrance than a help. Martin Stewart, director of London Money, said that the mortgage market seems hell bent on making life as complicated as possible, with the profusion of deals available only adding to that.
He explained: “There are mediocre rates out there but of more concern are mediocre lenders with mediocre criteria. Half the job of the broker now is that of being an underwriter, so we really could do with tools that make that aspect of the job easier. I would rather have one product that has the features my client needs, than 5,000 products which don’t.”
Rachel Lummis, mortgage adviser at Xpress Mortgages, said that choice was obviously a good thing for borrowers, as they all have their own specific needs.
However, she warned that some lenders appear to offer a “a barrage of products” in order to ensure they dominate page after page of results on sourcing systems.
She continued: “With new lenders entering the market and the competition hotting up, the level of choice for consumers is the best there has been in years, which is great. But there can be too much choice. I would rather see a suite of quality products from lenders rather than a huge list one would need hours to work through. It’s about quality and not quantity.”
Mark Dyason, director of Edinburgh Mortgage Advice, suggested that the increased number of products was likely a result of a flat market with increased lender targets. He said: “If you fill every LTV band with a marginally better rate than the one above, it can capture a deal otherwise missed.
“Lots of BDMs have been telling me about how their process teams think out of the box, but it is rare I see this demonstrated. Clearly it is something being talked about by lenders, so we might see more delivery of this over the next few months.”
