TSLE2020: Lenders must play ‘big part’ in encouraging borrowers to seek advice – Adams

Presenting at The Specialist Lending Event, Adams (pictured) referred to Pepper Money’s Adverse Credit Study, published in October, which found that 69 per cent of respondents were worried they would be declined a mortgage due to bad credit while just 40 per cent said they would go to a broker for help.

Adams said at the moment brokers were “part of the mix” in getting borrowers with adverse credit back on track but added they did not play as big a part as they could.

He said: “When we talk to borrowers and ask ‘how do you plan on improving your situation ahead of getting a mortgage?’ most of the customers refer to cutting back on general lifestyle and recreational activities, trying to clear their credit and reduce their mobile phone contract. 

“We have a big part to play in educating the borrower to come and see brokers to get advice.” 

Generating referrals 

He also said helping borrowers with adverse credit reach their goal of getting on the housing ladder could be a source of referral business for brokers as it improved their mental health. 

The survey also found that 48 per cent of people said financial worries had affected their mental health and wellbeing. 

He added: “Many brokers don’t advertise their business so that’s another driver behind referral business in this market.  

“Because you’re helping customers to get on that housing ladder and realise their dream, they end up doing something that betters their wellbeing.”