How best to describe the last few weeks in the mortgage market? Stressful? Frustrating? Overwhelmingly busy? All of the above and then some?
Long hours will have been worked, some sleepless nights will have been had, however, a significant number of borrowers will be left incredibly grateful for the hard work of their adviser to get them the mortgage they wanted/needed, albeit perhaps not at the price they envisaged.
It’s obvious to say that since the ‘Mini Budget’ dropped we entered a new phase for the mortgage market, one that was anticipated to appear in the medium to long-term, but not anticipated to materialise quite so quickly.
In this new phase, advisers have come to the fore in a way I can barely remember in my 30-year career. Of course, we’ve had such major spikes in activity before, sometimes due to Government interventions such as Stamp Duty changes, but also in the immediate period post-lockdown, when borrowers were seeking advice in periods of relatively benign rates. We can’t say the same today.
Playing the hand you’re dealt
Naturally, advisers will be hectic with clients who are more concerned about their mortgage arrangements than ever before, and advisers have a critical role to play, to prevent consumer harm.
Today’s market does present opportunities for the adviser profession and given that none of us can accurately predict what might happen over the course of the next six to 12 months, then you should certainly play the hand you are currently dealt and play it to the best of your ability.
At what other times will you see such demand for impartial mortgage advice and expertise? When media headlines are focusing so regularly on the mortgage market and, what might happen next, then having the ability to service concerned borrowers is essential.
It can provide an income opportunity for adviser firms, especially given the future has yet to be written. It can provide solace and certainty to existing borrowers, and it can ensure you increase your client numbers, allowing you to provide advice in other areas, and generate more referrals and recommendations.
Making sense of the complexity
The want, need and demand for professional advice is here today because people want to make sense of an area of finance that they tend not to understand due to complexity and sheer choice, and we also shouldn’t forget that many who would have often gone straight to their existing lender, are finding it difficult to do that. They need advice from an expert.
Indeed, the alternatives for consumers, particularly in a fast-paced market where time is of the essence, are just not appealing. We hear regularly about consumers approaching lenders directly of late, hoping to see an ‘adviser’ and have been told it is going to take several weeks to get an appointment.
Given those circumstances in direct-to-consumer lending – and the fact that resource levels at many banks and building societies have been used to service intermediary business rather than direct – the intermediary option for consumers grows ever more attractive, especially for anyone who may have tried to sort out a mortgage for themselves recently and ended up languishing on hold and/or waiting to be ‘seen’.
No apologies needed
The current market challenges are ones that advisers should not be afraid of highlighting and they should continue to stress how they navigate and accompany consumers around these obstacles, how they source from the entire market, delivering wide consumer choice, and how they come armed with solutions not just for the mortgage but also increasingly-needed protection and GI, how their advice comes with the protection of PII.
No adviser will be delighted with the current macro-economic scenario, given the impact on rate rises, stress test changes, affordability models, and everything else we have seen recently, but this is the market as it stands today, and it is advisers who are ultimately best placed to navigate it on behalf those looking for mortgages.
Let’s not be apologetic about this because where this road leads is still yet to be seen – instead, let’s seek to help as many clients as possible, and give them, and their friends and family, every reason to keep coming back to you and being grateful for your valuable expertise.
Rob Clifford is Chief Executive of Stonebridge