If you do not already operate in the specialist lending sector, you might be wary of dipping your toe in.
But ignoring it as an option may mean you missing out on the chance to help your clients and boost your business.
Perhaps you think so-called niche markets are too complex, you don’t have relationships with the specialist lenders, or you worry it will be time-consuming and may not result in a completion or the best outcomes for your clients?
In fact, advising clients in this sector is more straightforward than ever, and offers a way for brokers to appeal to those clients who need your help the most.
Many borrowers now find themselves excluded from the high street and in need of independent mortgage advice.
You can be the professional to help them fund their homeowning, investment or home improvement aspirations.
Here’s five reasons why it is worth taking a second look:
- ‘It’s all about who you know’
Specialist lenders love to build strong relationships with brokers, because they understand that you are qualified professionals who understand your clients’ needs.
Without branch networks they rely on brokers and want to nurture long-lasting partnerships. But it’s not a closed shop.
They want to work with new intermediaries too, no matter how big or small.
The best specialist lenders will show you exactly what they can offer your clients and your business, help you to get registered, and support you every step of the way, online, over the phone and in person with a BDM.
- ‘Specialist lenders don’t use technology’
Contrary to what you might think, specialist lenders have some of the most cutting-edge technology in the mortgage market. They do not have the legacy issues of the big banks, and they can adapt their processes quickly because of their smaller size.
Of course, by definition, specialist lenders offer flexibility; a real expert underwriting each application on a case-by-case basis, providing that human touch.
But enhancing this personal approach with leading technology creates a powerful proposition for brokers.
Together has invested massively in its own system – My Broker Venue – to make the submission of cases as swift and easy as possible, so you spend your time advising clients, not laboriously re-keying their data.
- ‘My client’s deal has fallen through and there isn’t time to save it’
Some lenders take weeks to make a decision and when it’s an unexpected no it can not only cause huge frustration for all involved but could, in the worst-case scenario, derail your client’s property purchase altogether.
You may think it is too late to save the deal, but do not give up. Specialist lenders are experts at getting time-critical cases over the line against tight deadlines.
Together frequently moves from application to releasing funds in a matter of days when necessary, because it recognises the huge implications of a case falling through, for your relationship with your client, their finances and potentially their home.
- ‘This case is just too complicated’
You might think your self-employed landlord buying a thatched cottage on a tight deadline is tricky to place. And that is before you discover they have credit problems.
It may look impossible, but specialist lenders deal with complex cases day in, day out.
Their underwriters know how to assess unusual income, unusual properties and to assess risk where the borrower has bad credit.
Expert underwriters will look at the bigger picture of their finances to assess the affordability of a particular deal for your client, and will hopefully be able to iron out any problems to provide the finance they need.
That does not just help the borrower achieve their property goals, it helps you to keep hold of the business while building that invaluable client relationship.
- ‘My client will be charged through the nose’
This is probably the most commonly held myth about specialist lending – but a quick look at the deals available reveals that rates can be highly competitive.
Just like the mainstream market, there is a vast swathe of specialist mortgages on offer, ranging from fee-free deals to flat-fee and percentage fee products, with low starting rates, long-term fixed rates and every other combination you can imagine.
Likewise, your clients vary widely, from the newly self-employed who do not yet have two years’ accounts to those who may have fallen into debt following a life-changing event.
Obviously, the more complex the case the higher the premium on the pay rate, but this is a highly competitive marketplace with dozens of lenders, which keeps downwards pressure on interest rates.