OSB sales restructure includes senior departures
Field-based business development managers (BDMs), a new intermediary sales development department, and the specialist finance team will report into group sales director Adrian Moloney.
Meanwhile, the corporate account team, which manages the relationship with mortgage clubs and mortgage networks, will report into group distribution director Roger Morris.
As a result, two long-serving specialist distribution managers, James Briggs and Daniel Watson, have left the lender – confirming the changes on their Linkedin pages.
Briggs had been with the lender for seven years most recently in the bridging finance and second charge arena, while Watson had served four years with the specialist lender.
When asked by Specialist Lending Solutions the lender did not give any details on the change to the size of the team, how many people had left the business or if there would be any further changes as the lenders come together.
They follow former head of sales Jamie Pritchard who confirmed his exit last month, having won the head of sales title at the British Specialist Lending Awards 2020 in October.
Following the restructure, it said heads of intermediary sales development, specialist finance, corporate accounts and two national sales managers have been appointed.
Simon Cockerill has been appointed as head of intermediary sales development across all lending brands.
The role will be to develop and lead a new and enhanced telephony and web-based service that will assist field-based BDMs and enhance the contact strategy to support broker partners.
Emily Machin takes on a new role as head of specialist finance, leading the sales teams covering bridging, second charge and commercial lending for Precise Mortgages and InterBay Commercial.
Liza Campion has taken the position of head of corporate accounts for all lending brands and is responsible for all senior relationships with mortgage club and mortgage network partners.
James Forth and Alan Kimber will take up wider national sales manager roles overseeing the BDM teams for Precise Mortgages and Kent Reliance for Intermediaries respectively.
Writing on LinkedIn, Briggs said: “I’ve had a great seven years, learned a lot and worked with some fantastic people and businesses.
“I’m very grateful to Alan Cleary, Roger Morris, Jamie Pritchard and Adrian Moloney for their support, along with all the other great people I’ve worked with.
“I look forward to a fresh challenge in the New Year, in the meantime I wish all my contacts a healthy and happy New Year.”
Watson also thanked Morris, Pritchard and Moloney after his four year there.
“During this time, I have had the opportunity to work with some fantastic brokers and specialist distributors while expanding my knowledge across the whole specialist market including, buy to let, residential and bridging,” he said.
“It’s been a pleasure working at Precise with some amazing people, in particular the sales team that was formed over my four years.
He added: “I am excited about the next chapter in my career in 2021.”
Commenting on the restructure, group managing director for mortgages Alan Cleary congratulated Cockerill, Machin, Campion, Forth and Kimber on their new roles.
“Through these internal appointments, we’ve captured the experience and knowledge of our best people and utilised their skills to further strengthen our aspiration of becoming a bigger, better and stronger specialist lender,” he said.
“With regards to the people that have exited the business, I wish them all the best for the future.
“Intermediaries have always been fundamental to the success of the group and pivotal in providing borrowers with sound advice, especially during such a challenging time in the mortgage market.”
He added that the changes reinforced its continued commitment to the intermediary market and corporate accounts.
Kent Reliance overhauls limited company criteria including personal guarantees
For lending to non-trading company special purpose vehicles (SPVs) Kent Reliance now requires personal guarantees from all shareholders in addition to the existing requirement for directors.
If a shareholder is another limited company and the shareholders and directors are different from the borrowing entity they will also need to be included on the application.
Under 18-year-olds listed as shareholders who are dependents of directors do not require a personal guarantee.
The lender is also now accepting intercompany loans as a source of deposit provided they meet certain criteria.
Among the details, it excludes transfers between offshore companies and loans must be repayable by a certain term and documented.
HMRC’s ordinary rate of interest should be applied and if there is a monthly payment this will be factored in to the interest coverage ratio (ICR) calculation.
Kent Reliance has also combined its business plan, cashflow, and asset and liabilities forms which will still continue to require one month’s bank statement to evidence the cashflow showing rent and mortgage payments.
Adrian Moloney, group sales director at Kent Reliance for Intermediaries, said: “As a leading specialist lender in the limited company space, we demonstrate a flexible approach which is supported by our wide criteria.
“Limited company lending is an ever-growing part of the buy-to-let market and we regularly share our knowledge and expertise with our broker partners to help them navigate towards the right solutions for their clients.”
Kent Reliance expands HMO and MUFB range
Rates on the range start from 3.79 per cent, with loan to values up to 75 per cent (LTV) on one to six bedrooms or units, and loan sizes up to £3m.
The lender offers up to 70 per cent LTV on seven to 10 bedrooms or units, with loans at £1.5m.
First-time landlords are considered on one to six-bedroom properties.
Limited company structures are welcomed, and the lender said it will consider less than perfect credit profiles.
Dawn Mirfin, group underwriting director at Kent Reliance parent company OneSavings Bank (pictured), said: “As a specialist lender, we’ve got the ability and experience to consider applications that other lenders may not be able to, because we look at each loan application individually and make a judgement based on the case’s own merits.
“Our service levels reflect our professional expertise and we’re pleased that our current buy-to-let service levels remain strong with AIPs assessed within 24 hours and a full underwrite within four days.”
Lean on lender support to cope with document ‘heavy lifting’ – iVENT 2020
Speaking at the virtual mortgage administrator iVENT 2020, Cockerill (pictured), head of sales, said landlords were looking to cash in on the stamp duty holiday by snapping up new properties to boost their portfolios, purchasing a short-term let or restructuring to a limited company.
But the increased demand combined with the extra supporting documents required by lenders was creating more work for support staff.
And as the 31 March deadline for the stamp duty holiday draws closer, Cockerill warned administrators to expect the last minute rush to mirror the same spike in sales seen before the 2016 second home surcharge was introduced.
Cockerill says mortgage support staff should lean on all the resources available to help them cope with the surge in demand and more complex document process.
“In the post-Covid world, the heavy lifting in the document process just got heavier,” said Cockerill.
Many lenders will “do the heavy lifting for you” when it comes to large portfolio clients, he added.
Engaging with business development managers can help speed up the application to offer process and help to get the packaging requirements right first time. Cockerill advised administrators to use Live Chat functions as well as the phone, which give staff a transcript of the call should it be needed for client records.
He also suggested that administrators kept their own library of past success stories to refer back to.
“Create your own case studies of what went well and when you have experienced a lesson that will help you in the future when dealing with a certain lender,” he said.
BDMs and brokers – will the relationship ever be the same again?
They absorb stress from above when the lender tightens policy and pressure from below diplomatically dealing with demands from a broker desperate to complete a deal.
And if they have done their job well, they can leave the broker’s office at the end of the day with a beer in the diary.
Relationships, say BDMs, are everything in this role.
But with face to face visits and travel on hold for most firms, how will the role of the BDM evolve to the new way of working without losing relevance in the market?
Swapping life on the road for life at home
A BDM for 25 years, Nadeem Iqbal’s working life has drastically changed going from four days on the road, to five days at home.
“On a personal level, being on the road is something I love to do,” says Nadeem who covers Greater Manchester for Accord. “When you are in a meeting, physically sat opposite someone, you can give it your full focus.
“But working from home going from call to call, email to email I find I am being more reactive rather than proactive.”
One of the upsides of being at home, however, is being more available to his intermediaries.
“Now I’m not on the road, I’m speaking to many more brokers. With the best will in the world you can’t get round every broker in your area but now I can because I have more time,” he says.
The Zoom bug
Technology has made it possible for office workers to work from home, and during the core lockdown months between March and June friends and family relied heavily on tech to stay connected.
The proportion of people making video calls doubled during lockdown, with more than seven in 10 doing so at least weekly, according to Ofcom. Zoom has seen a rise of almost 2,000 per cent in users from 659,000 in January to 13 million by April.
But contrary to the hype, BDMs say they’re not using video conferencing all the time.
Scott Apps, has been a BDM for Castle Trust for five years and covers London. He says his brokers prefer frequent and brief contact to keep them up to date so he emails information and calls them for short conversations.
“I’m conscious that you can’t demand an hour of someone’s day every time you want to speak to them,” he says.
“We can’t expect brokers or an entire company to be that accessible. I would walk past them in the office, knock on the door and say fancy a coffee?
“We’d have a chat about some deals for fifteen minutes and that was it. But now brokers are at home looking at their diaries thinking I can’t spare an hour to talk to him, I have too much on.”
Instead Scott says he has been more successful getting intermediaries’ attention by suggesting regular and short conversations.. Zoom is useful, he says, if you want to speak to a couple of people at the same time.
Nadeem says his main methods of communication are now phone, email, texts and whats app.
Despite the lack of visual communication, Nadeem says he feels like he has got to know his brokers better.
“I’m getting to see the personal side of my brokers,” he says. “Of course you got to know them well before, but now we’re having a laugh.
“There’s suddenly a scream in the background because their kids are having an argument or they have fallen over, or the dog is barking.
“Then you have that lighthearted conversation, not just about work but about our personal lives.”
Email enquiries and phone calls are still a staple of Andy Williams’ day, but he is using Zoom to conduct drop -in sessions. Andy is a BDM for Kent Reliance, covering Berkshire, Hampshire and south west London.
One of his broker firms has asked him to host a two hour video call session once a month and he gets 10 minutes on a one to one basis with brokers.
“When you walk the floor at the some of the bigger firms, you don’t often get time to speak to anyone for very long,” he says.” This way you have their attention for a full 10 minutes and it has worked really well.
He has also been holding webinars with individual firms to give them updates on products and policy via Webex.
Halifax BDM Nick Jury who covers central London says he has been asked to communicate with firms in varying ways. He has lots of virtual meetings lined up with his bigger clients but says brokers are missing the face to face interaction.
“Like us, brokers are working remotely without their support network, so I feel that when I am having conversations with them now it’s not just business it is more personal. You are their support network.”
Halifax has no plans to send BDMs back into brokers’ offices, says Nick, so until then he is coming up with new ways to keep in touch, such as ‘surgery visits’.
One of his firms has asked for a reoccurring virtual meeting where there is no set agenda or presentation, he is just available at that time and brokers are free to dial in to discuss their cases.
Whatever way BDMs are using to keep in touch with brokers they agree they can fit in more appointments than they did before.
Back to the norm?
So should the BDM’s role revert back to its traditional ‘on the road’ format in the future?
Nick says there will always be a place for face to face communication between brokers and BDMs.
“People buy off people,” he says. “You are not buying a product, the product is your relationship.”
But some of his firms have said they are re-evaluating their business, and whether they need their central London office.
Scott says he is looking forward to returning to some normality and thinks there will be face to face meetings as soon as companies allow it. But the Zoom bug for some, will remain.
“I think some brokers may still prefer the 20 min Zoom call, rather than eight lenders all coming in to talk to them on the one or two days they all come in to the office,” he says.
Nadeem says the Accord BDMs do believe the their role has changed, and will continue to change because of the pandemic but in-person meetings will always be an integral part of his job.
One part of his job that has changed for the better, is his commute.
“I don’t miss the traffic jams,” he says. “I’ve probably never had family time as good as this with my wife and two children. We have more time to spend together in the evenings and we have never communicated as well as we have through lockdown.”
OSB publishes criteria for furloughed and self-employed borrowers
Precise Mortgages and Kent Reliance for Intermediaries will both accept furloughed borrowers for residential applications.
This will be at 80 per cent of income to a maximum of £2,500, along with any evidenced employer top-up above this amount.
However, for those on the Self Employed Income Support Scheme (SEIS), current income will be used for affordability purposes where evidenced.
And it will not accept bounce back loans and coronavirus business interruption loans (CBILs) as a source for a deposit.
Where buy-to-let cases are concerned, OSB is still not accepting applications with top-slicing.
Where the landlord has income that is unrelated to buy to let, and is in receipt of furlough or SEIS income, then the application can be considered.
Again, bounce back loans and CBILs are not acceptable as a source of deposit.
The lender stressed that there may be additional underwriting requirements applied to these situations and brokers should check with the lender before submitting cases.
OSB, which includes Interbay Commercial, added that all buy to let and residential pipeline cases where valuation fees have been paid, will be progressed in line with the lending policy in effect at the time of application.
This includes honouring the product the case was initially submitted on.
Again, OSB noted: “As expected in the current climate, there will be some additional underwriting checks needed, such as ensuring the client’s current circumstances are considered.
“However as long as these requirements are met, the original application will be able to progress.”
OneSavings Bank managing director Alan Cleary (pictured) said he was fully aware how important it was to a broker and their customer that when they paid a fee for a product, they had the confidence that their transaction will be honoured.
“We’re in a position that we can move forward as a group and help brokers develop their business as well as ensure they can continue to service their existing customers,” he said.
“We’ll work on cases in date order but ask that brokers please bear with us as we’re working in exceptional circumstance at reduced capacity.
“Our broker partners have my personal assurance that we’ll get to them to discuss their client’s needs and will uphold existing arrangements subject to underwriting,” he added.
OSB extends offering but warns market will not return to normal overnight
OSB managing director Alan Cleary (pictured) told Mortgage Solutions that while lifting restrictions in the property market was very welcome, lenders were still restricted in the case loads and services they could manage.
“This is not going to be flick a switch and all comes back to normal, this is going to be a partial return over months and months,” Cleary said.
He continued: “We have all had a fairly challenging period, us included. We’ve got our fair share of payment holiday requests and also had to figure out how to keep our staff safe and well.
“We now have 75 per cent of our staff working from home with the minimum number of people in the office who cannot work from home.
“Clearly all this has impacted [case handling] volumes for all lenders.”
Cover as many bases as possible
OSB, which includes the Precise, Kent Reliance and Interbay Commercial brands, said the new product range launched across the trio represented the initial phase of a structured rollout plan as valuers return to the market and estate agents start to open their doors again.
“There is a focus on residential and buy-to-let – we’ve tried to cover as many bases as we can but haven’t done everything on those,” Cleary said.
“We’ve got houses in multiple occupation (HMO) and limited company on buy-to-let and Help to Buy on the residential offering.
“The biggest thing to be moving on with is when we can get staff back in the office and that will be when the government says it is safe.
“The next push will be to widen out the product range and then we’ll make further moves,” he added.
The extended LTV limits will be applied to pipeline cases and new applications, with the lenders going through their case loads to find those which will now be eligible.
OSB has gradually been rolling out desktop valuations among the brands since the coronavirus crisis hit and applying these to its pipeline as well.
Cleary was not able to put a figure on how long it would take to clear the pipeline, but said he hoped OSB would be able to work through it quickly.
“We are treating customers fairly in terms of fees and other requirements,” he added.
Light at the end
Overall, Cleary is generally positive about the current situation within the mortgage and wider property market, but acknowledged that the lockdown had been a tough period.
“The purchase market was obviously dead because the property market was held back and the whole market was subdued,” he said.
“We will wait and see in the coming weeks how volumes are going to spread out – there’s some light at the end of the tunnel but we’re going to have to take one step at a time.
“The statistics coming from estate agents over the last week have been encouraging and there’s still a lot of interest in property.”
Cleary reiterated that the sector would find ways to get back to normality and the need to protect staff and people in the market was the top priority.
Kent Reliance and Precise increase LTVs to 70 per cent
The lenders, which are both part of One Savings Bank (OSB), have increased the maximum loan size and maximum property value they will accept to £525,000 and £750,000 respectively.
OSB also published its first quarter results which showed it completed a combined £1.5bn of mortgage lending between January and March.
It noted that take-up levels of mortgage payment holidays have been high with around 24,000 borrowers accounting for 27 per cent of its book by value taking a pause.
However, it added that many people requesting payment holidays were doing so “to prudently safeguard cashflow” and that demand has dropped significantly since the initial surge.
And market research among buy-to-let landlords conducted on behalf of OSB indicates that rents are still being received, with only 12-15 per cent of landlords who have requested a payment holiday giving the reason as tenants having stopped paying rent.
Continuing product extensions
The product moves are the latest step as the lenders evolve their offerings after being forced to halt lending in March as a result of the Covid-19 lockdown restrictions.
Last month they recommenced lending up to a maximum 60 per cent LTV on property values between £75,000 and £600,000 a maximum loan size of £360,000.
Earlier this week Precise relaunched its bridging and second charge mortgage ranges supported by automated valuation models (AVMs) at up to 50 per cent LTV.
And yesterday Interbay Commercial resumed buy-to-let lending with a range of products using desktop valuations up to 70 per cent LTV.
The lenders noted that for brokers already with eligible pipeline cases at pre-offer stage, they may be able to switch the product if desired.
They will also consider reducing loan amounts on existing applications to meet the 70 per cent LTV limit.
When switching a product, any fees that can be refunded will be done so when the application reaches formal offer.
Supporting pipeline cases
OSB managing director Alan Cleary (pictured) said the lender’s teams had been working hard to ensure they had the infrastructure in place to best support broker partners and their customers.
“During this time we have focused our resource on supporting pipeline cases first before opening up for new business across our various product lines,” he said.
“The great news is that from today, Precise Mortgages, Kent Reliance for Intermediaries and InterBay Commercial are officially resuming business and taking on new cases.
“Our broker relationships remain absolutely key and we’re committed to continuing to provide specialist lending solutions during these challenging times.”
OSB CEO Andy Golding added that he was extremely proud of the resilience the firm had demonstrated in the current difficult conditions.
“We entered the crisis with exceptionally strong capital and liquidity positions which allowed us to rapidly assist those concerned about potential financial difficulty by offering payment holidays on a self-certified basis,” he said.
“We demonstrated our flexibility by redeploying our employees to meet the large increase in call volumes.
“We started the year with a strong pipeline of new business and continue to lend to new and existing customers, prudently and with a reduced suite of products. We have enhanced our underwriting to accept desktop valuations due to the inability to perform physical valuations at present.”
Precise and Kent Reliance restart lending with product launch
The pair stopped accepting new applications and put all cases which had not yet progressed to offer on hold at the end of March as a result of the coronavirus crisis.
However the lenders, which merged last year, have now launched offerings up to a maximum 60 per cent loan to value (LTV) by utilising desktop valuations.
No assessment or valuation fees are being applied, property values between £75,000 and £600,000 are eligible with a maximum loan size of £360,000.
The lenders will allow applicants whose cases are on hold to transfer to the new products where the criteria fit and advisers and clients agree it is suitable.
This can include reducing the loan to value amount on the application.
Certain property types are excluded and these include:
- New build property or converted in last 24 months;
- Properties that have never been occupied;
- Studio flats;
- Flats in blocks over six storeys;
- Flats with suspected cladding or combustible balconies;
- Shared ownership and right to buy;
- Properties with land over two acres;
- Listed buildings;
- Modern methods of construction;
- Leases of less than 85 years;
- Properties adjacent to or above commercial premises;
- Properties subject to renovation/refurbishment.
Both lenders added that brokers should contact business development mangers with questions.
Reviewed by underwriters
Documentation from the lenders’ websites said: “We can now accept desktop valuations for new and existing cases that are in line with our current criteria, and the new criteria listed within this document.
“Desktop valuations will be reviewed internally once they have completed. Please note that this may result in cases taking longer than normal to progress, so please bear with us during this time.
“Once the valuation has been reviewed by the underwriter and they’re happy to proceed, the case will be processed in the usual manner.
“Due to the nature of desktop valuations, we’re unable to accept any valuation challenges, and the underwriter’s decision will be final,” it added.
TSLE2020: Dual representation can create ‘conflict of interest’
Samuels was speaking at The Specialist Lending Event in Birmingham, when the question was raised about the “poor service” and delays brokers experienced from the solicitors on lender panels.
He said the solicitors on his panel refused to do dual representation, as they felt it “contravened” the rules of the Solicitors Regulation Authority.
“You’ve got to be really careful. If it’s a vanilla product, it’s probably okay. If it’s a more complex, structured solution and it’s a lot of money, then be careful around dual representation and the representation your borrower is actually getting,” he added.
Lack of communication
However, other lender representatives suggested dual representation could be a positive and help smooth the completion.
Alex Upton, sales director of specialist mortgages at Hampshire Trust Bank, said lenders could help by being clearer in telling advisers that dual representation was an option.
She said: “An application will come in and the broker will have their own solicitors but will automatically instruct a lender’s solicitor and the customer’s solicitor because they believe that’s what the customer wants to do.
“Then further down the line the lender will tell them they could have used their representation. A lot of intermediaries don’t realise they don’t have to go for that [separate representation].
“I don’t think the lenders are educating the brokers enough to say who can do that.”
Upton argued that with just one solicitor it could become “much slicker as a process” with less back-and-forth and blaming each other.
“We need to put it on ourselves and make sure we are educating the brokers enough to say they can do that. It’s always worth asking a lender ‘do you offer that facility?’ before putting an application in,” she added.
Liz Syms, CEO of Connect Intermediaries, who was chairing the panel, said it was especially important to be clear about legal issues in the specialist arena, as cases were more complex.
She added: “The takeaway for advisers is to have those conversations in a lot of detail with clients upfront and explain dual representation might give a smoother process, but may not protect them as fully in this complex situation compared to if they had their own representation.”
Regarding the quality of service provided by solicitors, Upton said she was “frank” with the those on her panel and let them know if their services were not up to standard, she would not hesitate to replace them.
“Lenders need to take responsibility for holding those third parties accountable because they’re not the only ones available,” she said.
Samuels agreed that it was the responsibility of the lender, as he said: “The lender should be leaning into those solicitors and telling them to get it together.”
Simon Cockerill, head of sales at Kent Reliance, said a refined panel could give lenders more say in how things were handled. He added: “Having a smaller panel allows lenders to have more control over the process and communicate with solicitors.”
The Specialist Lending Event 2020 continues next week with free registration still available for the events at York and Liverpool.