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Tough Talk: Better credit data helping mortgage lenders target struggling borrowers earlier

  • 03/08/2022
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Bluestone CEO Steve Seal said more forensic credit data is allowing the lender to be proactive rather than reactive in detecting customers who may be under credit pressure or struggling to afford payments right now.

In a wide-ranging interview taking in the regulator’s Dear CEO letters to lenders, customer vulnerability against the backdrop of the crushing cost-of living crisis and rocketing swap rates, Seal takes some hard-hitting questions on the lender’s responsibilities in a difficult environment for specialist mortgage borrowers.

“From a range of data sources, credit data specifically, there are a whole group of data that allow us to understand or identify early warning indicators in terms of borrower behaviour. So, where people have loans with us, we might start to see signs of stress in terms of the management of their finances outside their mortgage, which may be interpreted as showing those customers are facing some pressure. Where we can see that, we proactively engage, signpost them on and offer the support that is appropriate,” said Seal.

In part two of the interview series, Seal said the lender is also working closely with its broker partners on this and has trained staff to spot both new and established vulnerable customers and signpost them on to organisations like The Samaritans if appropriate.

Victoria Hartley, contributing editor at Mortgage Solutions asked Seal where the lender’s line is in terms of spotting issues early, but not placing already indebted customers under further, unnecessary stress.

“This is not about putting customers under pressure. This is about getting the right tailored level of support for them and also making sure they understand what’s available,” said Seal.

The interview goes on to touch on a potential spike in missed payments for impaired credit customers, and asks whether lenders that securitise are less concerned if their borrowers go on to struggle with their mortgage payments post-sale.

Watch the second Tough Talk interview [10.58] below.



See the first part in the Tough Talk series here.

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