One need only look to cab firm Uber as an example of rapid innovation. It’s seems the firm has pushed its way to the top of the taxi market in no time at all. For some reason its proposition just clicked with the public.
On other occasions, however, it can be a very gradual process. Take social media, for example. It’s now huge and every business (and every individual) seems to have embraced it wholeheartedly.
Just like social media, the day will come where mortgage brokers consider second charges as a normal and vital part of their business to maximise their conversion rates and generate an incremental income stream. Promoting loans will bring in more mortgage customers, help retain existing clients and give your clients an alternative to applying for loans online.
Whilst there was hope the implementation of the Mortgage Credit Directive might make mortgage brokers suddenly more interested in the product the reality is it has been a slow burner. However, I feel that we may be at a turning point. From the conversations we’re having with brokers it seems the penny is starting to drop.
We’re talking to brokers who are recognising that if they don’t offer seconds they could lose a client entirely to another broker who does – meaning that competitor could also get all of the client’s future business.
They’re recognising the benefits of seconds as a short-term fix as well as the flexibility of the product enabling borrowers to use it like a secured overdraft or credit card facility.
They’re starting to switch on to the benefits. Indeed, one broker I spoke to told me if he wasn’t so busy with first charge business he would absolutely do more seconds because, with the help of the master broker, its lucrative and pretty straightforward.
Interest is starting to rise and that’s largely down to the fact that, whilst misunderstood by many, the products are excellent, very cost effective and regularly trump a remortgage on criteria, customer outcome and, believe it or not, even on rate.
You are either in or out of seconds. If you have not specifically excluded them in your scope of services every capital raising remortgage file you complete should contain evidence you have considered a second charge and why you didn’t recommend it.
Okay, so the second charge revolution didn’t happen overnight but neither did the social media movement. One day we will all be doing it.