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Mortgage brokers adapt to pandemic as fewer fear damage to business

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  • 10/03/2021
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Mortgage brokers adapt to pandemic as fewer fear damage to business
Mortgage brokers are less concerned about the impact the coronavirus is having on their businesses than they were four months ago, according to a survey by Virgin Money.

The proportion of brokers who say the pandemic is having a significant impact on their businesses has fallen from 54 per cent to 44 per cent, while almost a fifth say they don’t expect the health crisis to make any difference to them at all.

Brokers say they are still facing many challenges, however.

Half of those surveyed say the main obstacle they face is lenders changing their criteria, followed by poor service levels and banks tightening their policies. Only three per cent of brokers said Brexit posed any challenge to their businesses this year.

Some 26 per cent of brokers said the availability of higher loan to value (LTV) products was a major obstacle.

Mortgage interest rates are expected to remain largely the same this year, according to 55 per cent of those surveyed and 60 per cent expect remortgages to make up the majority of their business in 2021 as demand for new houses cools.

 

BDM team

To support brokers, Virgin Money has set up a business development team that can answer questions on the products and services of both Virgin and Clydesdale Bank brands.

Sarah Green, head of mortgage distribution and general insurance at Virgin Money, said: “The challenges faced by brokers as they navigate these unprecedented times are consistent with those reported in our survey from October and emphasise how essential it is we deliver on the needs of intermediaries.

“This is a key reason for us recently launching a dual-branded BDM team, so brokers can have direct access to a team when working on a transaction. We’re also excited to be part of the mortgage guarantee scheme for first-time buyers as we recognise how essential it is for them to get on the ladder and hope this will also help brokers working with that segment of the mortgage market. Our aim is to provide as much support as possible for brokers, buyers and sellers alike as the industry navigates through the challenging times ahead.”

Chancellor Rishi Sunak announced in the Budget earlier this month that the government would back a mortgage guarantee scheme that would encourage lenders to offer 95 per cent LTV mortgages. The UK’s five biggest banks have signed up and are expected to launch products in mid-April. Virgin Money will join the scheme in May.

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