Speaking to Mortgage Solutions, Hancock, underwriting manager at Pure Retirement, said a “real common misconception” some advisers had was that underwriting was “robotic” and had no personal touch to it.
He also said there was the incorrect perception that when a case is declined, “somebody stands up, rings a bell and dishes out the high fives. Really, that couldn’t be further from the truth”.
Having been a broker himself earlier in his career and with experience in both mainstream and later life lending, Hancock said the lifetime mortgage process was more protracted than standard residential, so there was more emotion as it was a “massive decision” for someone who had paid off their mortgage to take out another loan.
“It’s understanding the journey that the client’s gone through and that the broker has gone through, just to the point of application. And through that understanding, making sure that we’re tailoring our communication with the broker and making sure that we’re taking a very considered and sensitive approach,” he added.
Hancock said it was not a “light decision” to decline a case, and a lot of work, investigation and effort was put in by the underwriter before this point.
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“The underwriters know the journey the client has gone through can be highly emotive,” he added.
Hancock said brokers were encouraged to pick up the phone, get in touch with lenders and underwriters to discuss any challenges or misunderstandings with policy.
Keeping regular contact with underwriters
Hancock said Pure Retirement’s USP was that an underwriter was assigned to each case, giving advisers a consistent point of contact.
He added that it was better to get in touch with underwriters through the phone, as email sometimes slowed things down.
With complicated cases, Hancock said any issues “could be easily resolved by picking up the phone. It’s just a much more personable thing to do. We have a very proactive approach when it comes to assessing cases”.
The lender also works closely with its funders to explore different avenues and suggest alternative product lines.
Additionally, brokers can inform themselves of the underwriting process with Pure Retirement and any other later life lender’s website for hints and tips, or the business development management teams.
Pure Retirement recently published guidance following feedback from brokers and clients to make sense of the journey and improve the customer experience. It has contributions from specialists across the later life sector, including surveyors and legal experts.
More complexity among later life mortgage borrowers
Hancock said the fundamentals of how cases were underwritten had not changed, but the development of technology made the process more efficient.
He cited the introduction of online applications in place of handwritten ones and said artificial intelligence (AI) would only accelerate these changes further to improve efficiency.
“I don’t think that AI will ever take away that personal touch, because underwriting is one of those things where it needs a physical person behind every lending decision,” he added.
The lender is also taking more time to review complex cases, something Hancock said he was seeing more of, and in these instances, underwriters were “exploring every avenue” to move cases forward.
He said for this reason, brokers should not be afraid of complex cases, even if they had been declined by other lenders.
Shifts in the economic landscape have led to more lifetime mortgages being used for a wide range of needs, such as debt consolidation, repaying mortgages and aspirational needs such as holidays and cars.
He said the biggest change was a rise in complexity, whether with the property or the individual’s circumstances, which were becoming “less vanilla”.
Otherwise, the main reasons people were taking out lifetime mortgages were fairly unchanged.
Brokers can help underwriters with these cases by “painting a full picture”, Hancock said, rather than having to fill any gaps. He added that missing or incomplete information was the main reason applications were delayed, as well as having the incorrect or no ID.
The lender is continuing to review its processes and communication to streamline the process too, making sure it is client-centric and collaborative.
To manage client expectations, Hancock said brokers should be clear about timescales because “from a client’s perspective… the worst thing to do would be to say that has been agreed to, then lay down the line it’s been declined”.
He also said using a lender’s tools and guidance, such as its mailboxes, where brokers can send details to underwriters for a pre-application assessment to gauge whether a case may be approved.
Hancock said: “There are always cases where, once the valuation is done, there are things that could not have been foreseen, which means we can’t proceed. If that’s the case, there’s nothing that can be done.
“However, it’s about the preparation and keeping the client informed.”
