Advisers are currently having to deal with a marketplace which is both incredibly busy and incredibly frustrating in equal measure.
I’ve heard the mortgage process described as something of a ‘race against time’ with advisers trying to get cases into, and accepted, by lenders before they are subject to the shifting sands of this market, with products being pulled and rates being changed, with alarming regularity. This results in everyone in the market, especially advisers, feeling like they’re constantly playing catch-up.
In this product pull/rate change scenario, it would be somewhat easy to blame lenders given they’re the ones making the changes, and I have to say I have lots of sympathy for advisers forced to deal with such developments with just a couple of hours’ notice to respond. For those lenders providing such little notice, there’s a great need in our space to do better, and hope that request is taken on board.
Leaning into market ambiguity
However, we must recognise there are currently many moving parts to what lenders are trying to achieve, and what they have to do when competitors shift their products, and of course wider issues to accept, such as constantly changing swap rates, the cost-of-living increases, affordability criteria ramifications, not forgetting the business levels they want/need to achieve and the service they can provide with the resources they have.
These are just a few of the current challenges lenders must be on top of whilst also understanding their competitors, the need to avoid becoming a ‘lender of first resort’ and the subsequent pressures that brings on business levels and service.
There’s no doubt pressure on lenders that they wouldn’t have anticipated at the turn of the year. The anticipated drop in purchase activity hasn’t happened, due to ongoing strong demand, whilst remortgage/product transfer activity has also been buoyant, with many deals coming up to maturity.
Not forgetting the growing number of borrowers reacting to rate rises, and who are considering whether they should leave their current deal, pay an ERC and get onto a longer fix if (as they believe) rates are going to continue going in one direction.
Maintaining the status quo may mean missing out
For advisers, in this environment, it is perhaps understandable if your business is very much mortgage-focused. I’ve spoken with advisers and their staff currently working very long hours on mortgage cases, staying up past midnight to secure a deal for a borrower less they miss out and end up on a far costlier alternative. Plus of course we’re all acutely aware of the resource issues many are having in our sector and the knock-on effect this is having in terms of completion times. In that sense, no part of the property market has been spared.
It’s a truism of our industry that, during such busy periods, the mortgage part of an adviser’s work can be all-encompassing. But there’s a danger inherent in that approach, not least in the potential recurring income you could be missing out on if, for whatever reason, your protection and or GI penetration drops, or indeed if you are missing out on referrals to other specialists or packagers, for clients that you’re unable to advise.
However, it won’t need me to point out the positive difference you can make to both your clients and your business in providing advice across the full range of needs and demands. Recurring income developed right now can have a galvanising and transformational impact on any business going forward.
Of course, it’s a very difficult line to tread, especially when there’s so much change in the market at present, a lot to take in and keep on top of every day, and all when you’re predominantly a mortgage adviser. However, make sure that this period doesn’t end up being something of a false economy, and make sure you’re getting the most out of the business opportunities presented to you, whether mortgage-related or otherwise.