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Lenders pilot ‘predictive’ mortgage software with MBT sandbox

  • 28/03/2023
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Lenders pilot ‘predictive’ mortgage software with MBT sandbox
Five lenders have signed up to a Mortgage Broker Tools (MBT) sandbox which will allow them to see how criteria changes might impact their business volumes.

Lenders can make changes to more than 60 criteria elements using the predictive mortgage modelling software such as loan to value (LTV), as well as maximum loans depending on factors such as borrower type, repayment structure and age. They can also edit initial, reversion and stress rates to see how this might affect pricing when criteria and affordability are considered. 

The sandbox uses real-time information from MBT to give lenders an insight into how certain product changes could impact their lending volumes based on enquiries processed through the platform and other lenders’ criteria. 

MBT trialled the software in January and at the time said it would help lenders to optimise their margins and shorten the time it takes to launch products or make developments.

Tanya Toumadj (pictured), CEO at Mortgage Broker Tools, said: “Consumer Duty is just around the corner. The new regulations will put greater emphasis on lenders demonstrating products have been developed with fair value in mind to meet particular customer requirements – and this will require data to show rationale. 

“MBT sandbox provides lenders with a groundbreaking data-driven approach to product development, enabling them to create and refine products with specific customer segments in mind. By more accurately targeting customer types, lenders will be able to more easily demonstrate the approach they have taken and their reasoning why they believe the product will result in a positive customer outcome.” 

She added: “At MBT, we are now working with five lenders to help ensure they are able meet both their regulatory obligations and commercial objectives, by taking a smarter, more data-driven approach to product development.” 

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