Speaking to this publication, Peter Dockar (pictured), chief commercial officer of Gen H, said that it was on track to be a top 20 lender “in terms of run rate by the end of this year”.
He continued: “We are growing, which is great, and a lot of that has come since we launched the partnership with The Nottingham, that gives us stability and confidence in our funding base. The key thing is being able to benefit from retail customer funding [rather than relying on wholesale funding] means we can offer better pricing.”
The firm struck a £600m forward-flow funding arrangement with the mutual last year to accelerate the rollout of its products.
Dockar said that a number of “big lenders have really stepped into the market and flexed their pricing muscle” but it had still been able to “grow quite significantly” due to the partnership.
First-time buyer boost
He noted that much of the growth came from first-time buyers, adding that it was the “most pressing and the most dysfunctional area of the market”, but its mission was to “help everyone find their place on the housing ladder”.
Dockar explained: “I will say the majority is first-time buyers but we’re seeing remortgages, we’re seeing people managing divorces and break-ups and so on and we are also seeing children acting as income boosters to parents.
“I was initially surprised [at children supporting parents] but it does make sense because there’s that whole concept of the squeezed middle where people have got young kids to support and older parents to help out as well.”
“The nature of our proposition means we are helping people who otherwise couldn’t get a mortgage” he said, adding that 92 per cent of people using its booster product, either its deposit or income product, couldn’t have got a mortgage without Gen H.
Intermediary panel to grow to 15,000
Dockar said Gen H didn’t see itself as a specialist lender, instead describing itself as an “alternative lender”, so its “big priority is to “expand the number of intermediary partners it works with”.
“We want as many people as possible to access our proposition. Around 91 per cent of the mortgage market is intermediated so we need to be there,” he added.
Dockar continued that over the past 12 months it had grown its broker panel from 3,000 brokers to about 12,000 currently. He noted that it was aiming to increase this to 15,000 in the next few weeks with some “big launches”.
“We want to work with everybody, but we always prioritize the people who have scale because I think you need a bit of scale to be able to communicate the proposition effectively,” he added.
He pointed to its partnership with Primis, as well as digital brokers such as Habito, Tembo and Better as particular significant partnerships.
“Our mission is to be whole of market, and we have only been in the market for around 17 months so we’re fairly pleased at how quickly we’ve moved,” Dockar said.
Consumer Duty is ‘great development’ but does mean more scrutiny
On the Consumer Duty side, Dockar said that it was a “great development” and meant that it was doing more due diligence on the partners it worked with and vice versa.
“There’s a lot more scrutiny around the controls, target audience, demonstrating we have the rigours, the scale and the service level, which we are more than more than happy to do, alongside the proposition,” he explained.
Dockar continued: “I think it’s been a really important part of how we’ve explained what we do to brokers. In that, yes, we have these clever digital propositions which no one else can do, but we get the basics right.
“I believe it’s so important to be able to reassure our broker partners. You’re not just sitting there waiting six weeks for an offer because we lowered our rates by 10 basis points and got blown out of the water.
“We’ve deliberately built everything to make it scalable and I think that’s important for giving brokers confidence, and that’s made it easier to onboard people as they’ve seen we can handle scale.”
Dockar pointed to one of the regulation’s cross-cutting rules which is around helping customers pursue their financial objectives.
He said: “My interpretation of that rule is very much designed to say, as a firm, you can’t not lend to people because it might be a bit tricky. I think as a broker, you can’t say I’m not going to help this cohort of people because the rules make it a bit trickier for me.
“There’s an obligation to find good outcomes for customers. You can’t walk away from those obligations just because it might be a bit hard.”
He added: “But equally, the level of due diligence that you have to do ahead of launching, there’s much more groundwork ahead of it, but it makes it more important for the big firms particularly to show that they have a suitable range of lender partners, that they have wide variety.”
Conveyancing bundle deals accounting for third of combined sales
When asked about the conveyancing service that Gen H came out with earlier this year, Dockar said that “logic was impeccable” in adding the service.
“All of the customer research we did showed that the issues that kept emerging tended not to be at the front-end of the process, all the real pain points tended to be post offer and outside our control,” he explained.
Dockar added that as a product manufacturer “ultimately the buck stops with you with customer outcomes”.
“We wanted to be able to manage all of that but what’s really nice about it is not only can you get good customer outcomes but we were also able to take pockets of value in the housing chain and put that back into the rate because obviously the rate is the most important thing for many customers,” he noted
Dockar noted that its bundles, which is where a first-time buyer can get access to a lower interest rate and free valuation if they select Gen H Legal as their conveyancer, are accounting for around a third of member combined sales.
“That means that they’re getting the benefits of a joined-up service and are getting a cheaper rate, and in some respects I like to think it’s easy for the brokers because they’ve got everything in one place,” he noted.
