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Metro Bank raises product switching proc fee – exclusive

  • 12/07/2018
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Metro Bank raises product switching proc fee – exclusive
Metro Bank has increased its broker procuration fee on product transfers, as the lender looks to give greater recognition to the work advisers play in the cases.



The lender now pays intermediaries 0.3% for rate switches, up from 0.2%.

Borrowers can leave current deals three months early without incurring any early repayment charges and access any residential product offered by the lender without switching fees.

The bank has also today expanded its professional range to include dentists and vets, following feedback from brokers.

Metro Bank’s director of mortgage distribution Charlie Morley told Mortgage Solutions the lender has been “listening to the market”.

He said: “We are trying to make sure the customer has complete choice and the right proposition for them.

“But also, we want to make sure the work carried out by an intermediary is duly recognised.”

Product transfers are increasingly being carried out by brokers, Morley said.

In setting the new retention proc fee, Metro Bank looked at how much work is involved for advisers in the cases.

Morley said: “An intermediary is doing a huge amount of work at the front end and the rate switch is a lot less work then perhaps doing a full remortgage.”

He estimated the process of putting the case through after recommendation is around five or six minutes.


Technology focus

Over the coming months, brokers can expect to see improvement in Metro Bank’s online systems, as the bank invests in technology.

Morley said: “Intermediaries and lenders that don’t embrace digitisation effectively will be shunned by consumers.

“One of the key things you have to do as both lenders and intermediaries is work together, build the right technology, but also utilise the best of human skills – and that will be the best service that is offered to the market.”

However, the lender will be working to improve the “whole process” as oppose to many rivals that are concentrating their efforts just on how to get an offer out quicker, Morley said.

He added: “The moment a case is offered you still have this incredibly long process to completion…

“How do you make the whole end to end process slicker, instead of just worrying about the bit to get the offer out?”

At the moment, cases too often fall into a “black hole” between offer and completion, so Metro is implementing digital solutions aimed at improving the journey, Morley said.

He wouldn’t be drawn on what these initiatives will be, but did say that lenders could have closer relationships with solicitors, the customer and the broker over the process than is currently the case.


Good year for the market

The mortgage market this year appears to be matching 2017 in terms of positive sentiment and business, according to Morley.

He said: “2017 was a really good year, 2018 is pretty much in line… most people are having a pretty good year, so if we had a good year in 2017 and match it in 2018, I think everyone’s pretty happy.”

And brokers should prepare for another surge in remortgages if the Bank of England raises interest rates again this year, Morley said.

He also pointed out there’s also a lot of new lenders, helping to create a large amount of competition and increased choice for customers.

And brokers should always endeavour to meet new players in the market, according to Morley.

He said: “Embrace change and see any new lender that knocks on your door – even if it’s just for 15 minutes because you’ll learn something that you didn’t know existed from a product point of view.”

The other piece of advice Morley gives all brokers is not to bury their head in the sand regarding technology changes.

He said: “Technology that succeeds in this marketplace won’t be complicated technology, it will be simple technology that services a genuine need.

“Don’t be the one with your head in sand.”


Metro Bank’s incredible journey

After four years at Metro Bank, Morley describes his highlights as experiencing the lender rapidly grow from a very London-centric lender to a national lender that rivals the top six.

He said: “That to me has been an incredible journey.

“There are very few times in your career where you’re involved in such an exciting journey with a brand that is fresh, innovative and moves very quickly.”

When Morley first started Metro Bank had just two BDMs, but the number has grown to 22 today.

In another milestone, the lender launched into Scotland earlier this year.

Morley said: “I very much want to be the lender that makes a difference in the marketplace and genuinely challenges the market.”

The biggest challenge to Morely has been managing the lender’s growth over the past four years and carefully balancing it with the service offered.

He said: “Growing at a pace that doesn’t blow the doors off is the bit that you need to manage.

“When we started to really click in the marketplace, everybody wanted to deal with us – but I couldn’t do that.

“We probably cover the majority of the UK mortgage market from an intermediary perspective now – but if I’d done that four years ago, we would have fallen over.”

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