Virtual BMAs 2020 names Challenger as charity partner
Challengers is a charity that gives disabled children and young people the opportunity to play, have fun, and make friends in a safe and supportive environment.
The charity says too many children with disabilities miss out on the chance to play, which is vital to their development, because of physical impairments, a lack of accessible play facilities or a lack of support.
Jennifer Corless, head of communications and events at Challengers, said: “We are absolutely thrilled that Challengers has been chosen as the charity partner for The Virtual British Mortgage Awards 2020.
“We are an independent charity providing disabled children and young people with fun and safe places where they can play and make friends, while also giving their families with a much-needed respite from care responsibilities.
“It’s wonderful to have the support of The Virtual British Mortgage Awards and its guests, especially in this difficult year, as your generous donations will help us to reach even more disabled children and their families.”
Text PLAY to 70490 to donate £10 to Challengers.
The Virtual British Mortgage Awards drinks reception begins at 3.45pm on 15 December, and the main event will be streaming live to your homes at 4pm.
Tickets are available to anyone in the mortgage industry, however, you have to pre-book your complimentary place in advance to guarantee a ticket.
The deadline to book your place is 12pm on Tuesday 15 December.
Book your ticket on the event website: https://www.mortgagesolutions.co.uk/events/british-mortgage-awards/venues/bma-online/
The Awards will feature live entertainment, advanced social media interactivity, and more.
Sports presenter Colin Murray is the guest announcer and will be interacting live with guests and highlighting the best social posts with #BMA2020.
There will be a photobooth, sponsored by HSBC UK, and a prize for Tweet of the Awards sponsored by Digital Mortgages.
Winners will be announced on the day and sent their trophies after the awards.
‘Every application is a battle’ but the crisis is driving change – Marketwatch
However, heightened demand continues to put pressure on the sector so although every firm may mean well, there may still be hold ups across the market.
So, this week, Mortgage Solutions is asking: Have you noticed a decline or improvement in processing delays or is it roughly the same since the reopening of the property market?
Pete Mugleston, managing director at Online Mortgage Advisor
Everything is taking ages.
The volume of customer enquiries has increased at the same time as broker workload, and business development managers who were off on furlough have mostly now returned with their phones ringing off the hook, meaning most brokers take longer to get cases placed and packaged.
Lenders have been swamped with business at the same time as ripping up their criteria and underwriting policy, added for some, to work from home productivity issues.
Conveyancing firms have faced the same concerns, exaggerating issues that have always been there – a dump of business can turn a great service bad, almost overnight.
The speed of the increase is often the biggest problem, as people-centric processes are near impossible to scale at the rate needed.
Especially with the number of moving parts, such as delays with surveys – some reporting five-year highs and delays of more than 30 days, searches taking 20 to 40 days in certain areas, and mortgage paperwork, all weighing more pressure on an already fraught turnaround time.
We’ve seen a few examples that show this improving, but one thing is for certain, ever the optimist – it’s not all bad.
I’ve found myself saying this a lot recently – you need a crisis to drive change, and businesses across the whole property sector are having to find innovative ways of keeping up and staying safe.
A new, revived, and more productive market is quietly stitching itself together under the surface, and it’s only a matter of time before we see some breakthrough big wins.
Darryl Dhoffer, mortgage and protection consultant at The Mortgage Expert
Many solicitors are still working from home, and many have limited access to online management systems, so processing applications is taking much longer than normal.
The impact of the stamp duty relief and the Help to Buy scheme in its current form ending at the end of March 2021 has caused bottlenecks with cases – case opening times are subsequently being delayed.
So we are advising clients to select solicitors that have capacity to take on board any new cases in this climate and set expectations early with clients.
With regards to the free legals provided by lenders for remortgage cases, we are noticing, more often now than ever, panelled solicitors changing frequently with lenders and other companies being preferred.
We believe it is down to overcapacity for the previously panelled solicitors so lenders are looking at alternatives. The feedback so far from our clients is all seems to be working okay, which is a positive.
We also use broker conveyancing portals to obtain quotes for clients that need it, and we are seeing more ‘red light – near capacity’ warning signs for the conveyancers who are quoting competitively.
In some cases, we are seeing solicitors increasing their prices to ward off new business – similar to lenders’ actions of hokey cokey in the market; one minute being active and interested, then the next minute withdrawing and not able to assist.
I believe this is down to under capacity and over demand.
Adam Wells, co-founder of Lloyds Wells Mortgages
We have noticed a significant decline in conveyancing capabilities.
We understand that everyone is stretched and service isn’t quite where it should be, but conveyancers who are usually very reliable have been causing problems.
I have one specific case with a lender that is in a three-week queue to be assessed by an underwriter. The only way to get the case escalated is for the conveyancer to contact the lender and request an escalation.
The conveyancer in question has taken two weeks to let the clients and myself know that they won’t call the bank as the queues are over an hour. I’m still waiting for them to write a letter on headed paper for me to forward to the lender on their behalf.
Away from conveyancing issues, there are no other specific problems I have faced. We’re seeing a lot more automated valuations which actually speed up the process.
In all honesty, every single application feels like a battle from start to finish currently and I don’t know how anyone would be able to get a mortgage in the current market without the help of a broker.
How will lenders differentiate between Covid debts and high risk borrowers? – Star Letter 27/11/2020
This week’s comment was a reaction to the story: Virgin Money braces for surge in bad debts while mortgage lending falls 30 per cent
Stuart Phillips said: “I’d be more interested to know how a lender is going to differentiate between a ‘bad debt’ as a result of Covid-19 and a bad debt because the client is a high risk.
“If lending volumes are expected to dip, lenders are reluctant to increase costs and adverse credit cases will rise, how is the market going to adapt to that?”
He added: “I have to assume that lenders will want to continue lending to clients who were genuinely disadvantaged because of a pandemic, but no one is really talking about that.”
We need to question the industry’s reliance on government help – Marketwatch
Furthermore, calls for an extension to the stamp duty holiday which has already caused a huge boost to the market suggests government intervention in the property market is sometimes welcomed.
However, input from the sector is often not sought resulting in initiatives such as the Help to Buy scheme not always targeting its intended market, driving up prices and leading to more buyers unable to raise deposits.
More recently, the government went back on its decision for high-rise buildings over 11 metres to require an EWS1 form regardless of whether they had cladding or not, which left many homeowners unable to sell, move or remortgage their properties.
So this week, Mortgage Solutions is asking: Does government intervention benefit or stifle the industry?
Rob Gill, managing director at Altura Finance
Some 13 years on from the collapse of Northern Rock, and the subsequent nationalisation of several major lenders, there’s a strong argument to say government intervention has become essential to the UK mortgage industry.
Schemes such as Help to Buy rumble on and on, and while not direct government intervention in itself, the era of ultra-low interest rates is similarly never ending with base rate at or below 0.75 per cent for coming up to 12 years.
As the Covid-19 economic crises continues to unfold, it’s surely unlikely that government intervention will do anything but increase.
We seem to have swung from one extreme to another over the last decade and a half.
The heady days of pre-2007, ‘light touch’ regulation and Gordon Brown proclaiming we’ve ‘abolished boom and bust’ have been replaced by ongoing schemes, swinging changes in regulation, even more dramatic changes in taxation and billions upon billions pumped into the mortgage and property sectors via the banks and taxation ‘holidays’.
Whether this stifles or benefits the industry isn’t so much the question as what would the industry do without it? There’s a strong argument to be made that, without unprecedented intervention to rescue the banks during the credit crisis, the mortgage industry would have ceased to exist at all.
A more relevant question might be how do we cure the industry, and even the economy, of its reliance on such widespread government intervention?
The solution is likely to take far longer to arrive at than any vaccine.
Richard Campo, managing director at Rose Capital Partners
Recent results have been a mixed bag, as if you just take the Help to Buy schemes, both the equity loan and mortgage guarantee will tell you all you need to know.
With the mortgage guarantee, to my mind, this is everything gone right with how a government can help stimulate business. They offered a guarantee that allowed the return of 95 per cent lending post–credit crunch and when the market stabilised, this was removed.
Clean, efficient and it benefited the industry.
Conversely, when it came to the equity loan, this was extremely problematic as the government had a vested interest in house prices going up.
Hardly the Adam Smith version of free markets.
In the short–term, the benefit is that more transactions happened and faith was restored to the new-build sector. But has this simply stored up issues down the line for people wanting to move?
Has it inflated prices? Time will tell, but this feels more of a long-term stifling that may outweigh the short-term benefit.
The current stamp duty holiday feels very similar to the loan in that on one hand it has stimulated the market. But was it even necessary? Early this year purchase activity was already the highest in many years, so has the holiday simply put petrol on a fire and overly inflated prices which may just correct next year anyway?
This all highlights just how big and complex the property market is, so it is hard to say for sure if government intervention benefits or stifles the industry.
I think it is a bit of both which only highlights the lack of long-term planning that has taken place, which is what a government should really be doing.
Jonathan Clark, mortgage partner at Chadney Bulgin
I don’t believe that the current stamp duty holiday should be extended. 31 March seemed a very long way away when it was first announced – possibly, too far away – and estate agents, solicitors and mortgage brokers have had plenty of time to adapt, even in the current, admittedly very challenging times.
However, I was a fan of the reduced stamp duty land tax threshold for first-time buyers when it was first introduced, and still am, as well as the much fairer, marginal rates that we’re now used to seeing across all purchase prices.
The question of 95 per cent mortgages is a bit tougher – we desperately need such products to be made available as soon as possible to assist first-time buyers and hopefully, this will in turn encourage lenders back into this vital area of the market with similar products.
However, government intervention really shouldn’t be necessary with lender’s products, it should naturally sort itself out once the current excess demand for properties and mortgages subsides.
It does feel as if the government’s plans have backfired a bit here though. The majority of my clients are currently moving to bigger properties, purchasing holiday homes or even buy-to-let properties and many of my first-time buyers have wealthy parents that are able to gift them a 15 per cent deposit – surely not the intended outcome.
Risky lending environment is a big opportunity for smaller lenders – Star Letter 20/11/2020
The first comment was from Stuart Philips, who reacted to the article: Vulnerable borrowers and first-timers most at risk from Covid-hit mortgage market – FCA Insight
He said: “Whilst 70 per cent of mortgages in the UK go to the big eight lenders who will struggle to adapt to this with very rigid credit and risk policies, there is a huge opportunity for building societies and challengers who have the ability to look at cases on their own merits.
“Outside the big eight there are still another 50 or so lenders in the market.”
Philips added: “The problem is in matching complex clients with niche lenders because there is no financial incentive for brokers to put in the extra work required in these cases. The procuration fee on a £100,000 loan is the same regardless of whether you send it straight to HSBC with a few hours work or spend days on the phone to business development managers.
“Higher broker fees for complex cases affect those who can least afford them. The Financial Conduct Authority (FCA) and the industry as whole should be looking at this for a solution.”
High LTV caution
The second comment responded to the story: Lenders seek FCA permission to re-enter high LTV mortgages at same time
Kevin Roberts said: “Lenders should be applauded for considering a simultaneous return to higher loan to value (LTV) lending, a request I hope the FCA will sanction in due time.
“Nationwide Building Society had the courage to remain in the market whilst a handful of others dipped in and out in a way that was helpful to an extent but perhaps added somewhat to the frustration of our clients.”
He added: “May I temper this promising news with a note of caution.
“Working from home for these parties may not work as well as it should after seven months or more of planning. I fear that adding more transactions to an already protracted process will lead to a further deterioration in service and timescales.”
Some borrowers regret taking mortgage holidays but can’t be blamed for panicking – Marketwatch
UK Finance figures show around 2.6 million households took a payment holiday. But according to Experian only half of those borrowers suffered a decline in their spare income while a quarter used the scheme to build up a cash reserve. The millions of families who took the first wave of payment deferrals did not know then it could affect their future borrowing chances. That news came later from the regulator.
With the opportunity to apply for a payment deferral extended, now wiser, borrowers’ attitudes to the scheme may have changed this time around.
So, this week Mortgage Solutions is asking: Have you noticed borrowers are more wary about taking a mortgage payment holiday now it’s been said it could affect future lending decisions?
Paul Hampton, mortgage and protection consultant at Approved Mortgage Solutions
In the North East, not many people have taken out payment holidays. The take up was quite low from the beginning as a lot of people kept their jobs and unemployment wasn’t high.
Even in the cases where one party lost their job, usually the other party was still working. So I did not see many people go for mortgage holidays here.
However, I have noticed some of the landlords who took payment holidays out are now regretting it because they have come to apply for mortgages and underwriters are looking at their finances with a fine tooth comb.
They took a payment holiday to boost their cash flow, even if they still had rent coming in, but they now realise that although it does not affect their credit score it can affect future borrowing.
I knew of one who used the cash saved from a payment holiday to invest in further properties, which obviously they were not supposed to do.
When borrowers do that, it can make them look untrustworthy in the eyes of the lender because they wonder why people would go for a particular loan or support when their income has not suffered.
Piers Mepsted, managing director at Financial Advice Centre
Conversations with our clients have changed considerably since the introduction of the ‘generous’ proposal from lenders of a mortgage payment holiday.
Many borrowers were quick to take this up as at the time the future was unknown and it felt prudent to pull in the purse strings where possible. However, many of us as brokers remembered the problems borrowers experienced through taking a mortgage holiday during previous recessions.
By putting ourselves in the lender’s shoes, we see it is their responsibility first and foremost to protect the level of risk and balance sheets. For this reason, we are not surprised to see it could and therefore probably will affect lending decisions in the future, despite the industry reassurance at the time it would not.
We hear time and time again if something sounds too good to be true – it probably is.
Although credit references do not show payment holidays in the same way as mortgage arears, we are seeing questions about mortgage holidays; Covid-related job security questions and extra checks coming up regularly by underwriters.
Underwriters can also see if payment holidays were taken with sight of mortgage statements and the obvious request for recent bank statements.
Knowledge of this pending impact does not seem to be widely known outside of our industry and is not being cautioned by the government or the lending institutes. There was no guidance or caution offered when the flood gates were initially opened for a mortgage holiday instead, they were promoted heavily and easy to obtain.
The role of mortgage brokers and financial advisers in our firm has increased again to give advice in this area and ensure borrowers exercise caution by asking the question that should have been given months ago which is: ‘Is a mortgage holiday absolutely essential?’ and: ‘What other options do you have available?’
Payam Azadi, director at Niche Advice
I’ve seen less people going for them in the last month or so.
Recently it’s been communicated to them that there are consequences so I think now payment holidays are being taken for the right reasons, for people who are genuinely struggling. Before that they might have said: ‘just in case, let’s put a hold on things’.
I think, you can’t blame people because of the panic that was going around, nobody knew what was going to happen, or whether they would still have a job.
People took it as a precaution including a lot of those who were not struggling. I’m still torn because I don’t think you really penalise people.
A lot of people are losing their jobs and it’s out of their control. People that have lower incomes or are more financially vulnerable are being punished. They are in a genuinely vulnerable position and have had to ask for something that’s out of their control.
It doesn’t sit right for it to show on their credit report or have a knock on effect.
The clients are being punished – potentially three or four years down the line – for something that happens now that they don’t have a lot of control over.
There will be some people who say you should have protected yourself with income protection, or other types of protection to be able to deal with shocks. That’s a valid argument but I think what you’re doing is punishing people when they’re at their most vulnerable.
If advisers provided the same service as lenders, we would be deselected – Star Letter 13/11/2020
This week’s comment came from Derek in response to the article: Advisers self-serving queries means lenders can stay at 90 per cent LTV lending longer – Duncombe
He said: “Everything in the article is correct, but it is based on the lenders keeping their information up to date and providing accurate information and updates, and as much as they would like to think they are perfect, they are not.
“We don’t call you because we want to, we call you because we have to.”
Smaller lender successes
Derek added: “I have to say that Accord and a number of smaller lenders are doing a great job, but larger lenders are really letting advisers down…
“This is not just down to being busier and staff working from home as relatively speaking, smaller lenders have the same percentage increase in business with smaller staff levels and are also working from home.
“They are however assessing documents in as little as 24 hours in some cases.”
“Lenders do not update their websites quickly and so information can be out of date or written in an ambiguous manner and we all know that some criteria never appears on the websites at all.
“If an adviser provided a service that was as repeatedly poor and inaccurate as these lenders, then the lenders would consider deselecting them” he added.
Derek added: “In short, advisers, carry on using the websites, sourcing systems and criteria tools.
“Lenders sort out your websites so the questions to criteria issues can be found quickly and accurately and sort out your systems and staff training.”
Updates and transparency stop clients feeling excluded in digital world – Marketwatch
And although technology has become embedded in society, many are still unsure about using it and feel more reassured when they have someone to talk to.
With service levels suffering while lenders become swamped trying to deal with requests for mortgage payment holidays, brokers can ensure they provide an ear to any borrowers with concerns.
So, this week Mortgage Solutions is asking: ‘What can brokers do to stop borrowers from feeling isolated and excluded as they are increasingly encouraged to use digital and direct means for mortgage purposes?’
David Hollingworth, associate director at L&C Mortgages
The mortgage and housing markets undoubtedly still have a lot to gain from the benefits that technology and process digitisation can and will bring.
Frustrations around the need to provide the same information more than once and for data to be rekeyed can be eased with system improvements.
Consumers increasingly expect to be able to have the chance to be kept informed through digital platforms. For example, the reassurance that your online shopping is on the way has now reached the point where you know exactly how many stops your driver has to make before they reach you.
Keeping customers aware of what is happening online is therefore likely to be something that is increasingly expected and is felt to be beneficial.
However, that cannot always replace the need for a conversation and reassurance from someone that understands the process. Buying a house and taking on the biggest debt that most of us will ever have is rather different to the purchase of the latest bestseller from your favourite author.
The current market where high demand, lender capacity and rapidly changing underwriting are at play can mean the need for updates can be even higher and being able to deal with customer concerns in the way they prefer is important.
As difficult as it can be when there may be delays and little to update, just being able to reassure the customer is important and can distinguish the service of advisers from a more faceless platform.
We’ve certainly found that customers have appreciated a phone call even when there may be little new to tell them, but it certainly helps remind them that you’re on their side.
Chris Hall, mortgage and protection adviser at Mortgage Guardian
Historically mortgage advisers have done quite well from being the go-to guy or girl within the local community by establishing and maintaining that personal connection with potential clients.
The good word spread, and recommendations flowed when the job was done well.
Business was always done face–to–face whether in the office or in the client’s own home. Networking quite often was done in the pub with a drink in one hand or on the local golf course. Quite often you would bump into your clients while out shopping.
This has always been an accepted way to build trust locally and to make the clients feel included. Many an adviser made a living this way and some still do.
Being part of a community is not dead by any means, but times have changed and business is quite often done on a non face-to-face basis these days. Online and telephone-based advice is popular but is also where a sense of exclusion or isolation can happen whether it is realised or not.
Most of our business comes from outside of the local community so our business is conducted online and via the telephone. We have looked at the client journey from start to finish ensuring that the clients not only receive outstanding service but also feel fully included during the mortgage process.
We look for ways to appeal to new customers. We understand that people do not get a sense of trust from a Google search result, so we have prioritised asking past clients for a review.
Generally, people write from the heart and that echoes the friendly service we always aim to provide. This helps new clients looking for a mortgage adviser.
Above all clients should not feel isolated or excluded as we explain everything as we go through the mortgage process.
Pete Mugleston, managing director at Online Mortgage Advisor
Society has had the kind of seismic mindset shift that doesn’t come along that often, perhaps only ever following such a catastrophic and more importantly, shared, event.
Like it or not, we have changed.
People, particularly the over 50s, who didn’t previously use technology like online shopping or video calls, things that have been around for years, now see the benefits and many are loving it.
Video has long been underused by intermediaries too, I think in part because the technology was so varied in terms of platform and device compatibility.
Now, with Zoom and Teams open to all, things are very different and the mindset of brokers needs to shift too – video offers a platform to deliver a new level of understanding and experience to customers that will help no end with sales, not to mention the potential compliance benefits.
Compare the cumbersome face–to–face visit or a phone call and email with some figures typed out, to a professionally designed presentation, with animations and visuals taking customers on a journey, endorsing you and your business, explaining the level of service and products to a level that was never achievable with words or hand gestures alone.
We’re not telling, we’re showing, in a far cheaper and quicker way, all without asking customers to let strangers into their home.
When you boil it down, rapport tends to be the critical rationale for face-to-face evangelists, a benefit I think has now shrunk beyond any viable value.
Mortgage Medics partners with homelessness charity Sussex Nightstop
The partnership will be for an initial period of two years, with an aim to support the charity’s goal to tackle homelessness in the region through regular funding.
The firm will also help to raise the profile of the work Nightstop does to its clients and the general public.
Sam Murphy (pictured), managing director of Mortgage Medics, said: “We’re thrilled to launch our partnership with Sussex Nightstop. They do such amazing work; helping young people and adults who are at risk of homelessness.
“Their efforts are focused on helping before people end up on the streets, which undoubtedly saves lives. We’re so proud to support their hardworking team of staff and volunteers.”
He added: “Our days are spent helping those fortunate enough to own property, so it was a natural fit to partner with Sussex Nightstop, to try and help people less fortunate with their housing needs.”
Alison Marino, manager of Sussex Nightstop, said: “The ability of Sussex Nightstop to make a positive difference to the lives of people who face homelessness and rough sleeping is only made possible through support from the local community. We are delighted that Mortgage Medics have chosen us as their charity partners and have no doubt as to the positive impact it will have.
“We know that Nightstop works but, crucially, we can’t do it alone. Knowing that we have Mortgage Medics and their customers proactively championing and supporting us in our objectives is what makes it possible.”
‘It is not just equity release brokers who are empathic, honest and altruistic’ – Star Letter 06/11/2020
This week’s comments were under the article: Advisers cannot just ‘dabble’ in equity release for extra cash – Star Letter 30/10/2020
John S kicked things off, saying: “Although I agree with the main comments that advisers shouldn’t dabble in any business area, I feel it is suggested that mortgage advisers in the residential market don’t need to be empathic, honest, responsible and altruistic.
“All we need to do is research on Trigold and choose the best rate – no experience or a deeper understanding of what makes the lenders tick required.”
“However, if you accept that non-equity release advisers already have these skills and apply them in their current jobs and could even be considered diligent and professional, why would they move into a new business area and act any differently?” he added.
Referring complex cases
LankyDes also weighed in, saying: “I don’t think Andy is saying that most of the people in the industry would be unsuited to it; just that they should be really serious about making it a major part of the business.
“I’m actually coming to a similar conclusion now days about protection. It is just so complex that I would rather refer it all to a specialist.”
He added: “I did one equity release ever under the grandfathering arrangement about 15 years ago. I put a lot into involving all the family in the discussions, the explanation of the deal and getting them all to sign the product confirmation letter. I also looked into the state benefits and things like that.
“I came to the conclusion after doing it that it wasn’t an area I wanted to get involved in.”