Cover
a good tradition of love and hate
The mortgage industry has never been so loved up. But are the relationships equal or is it all lip service? Sarah Davidson investigates
The mortgage industry is having a love-in. Apt timing given the month. But tenuous Valentine’s Day analogies aside, it has always mattered who you know and how well you know them in this business. Recently however lenders, networks and trade bodies have been romancing each other and brokers particularly avidly.
The market contracting dramatically has done three things to encourage this cosying up. One – there are far fewer players and it follows logically that it’s easier to know everyone (not to mention more visible if you don’t). Two – the lack of funding has shifted
the remaining players’ focuses. Lenders aren’t fighting tooth and nail for volume anymore and brokers have adapted from rate-chasers to deal-co-ordinators. The consequence, happily, has been a much stronger and more pronounced focus on the customer. And the third, inevitably, has been
regulation. For a previously aggressive mortgage industry the credit crunch was the moment the school bully was caught
stealing other children’s lunch money. For two and a half years the industry has been awaiting its punishment – or perhaps social rehabilitation – in the form of the Mortgage Market Review regulation proposed by the Financial Services Authority. But a lot can happen in 30 months and this school bully may have reformed all on his own. Robert Sinclair, director of the Association of Mortgage Intermediaries, says the shift is palpable. “In all my time in the industry I’ve not been aware of all key parties working together so well,” he says. “Partly economic adversity is forcing people to make expedient decisions due to less competition but I think partnerships are flourishing and people are working harder at them in order to survive.”
Key partners
Indeed lenders, distributers and trade bodies say they are dedicating time and money towards strengthening their relationships with key partners in an effort to improve the quality of business done and the standard of
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professionalism in the market. Perhaps the best example of this was the industry’s trade bodies putting aside their differences to achieve a common goal.
In October last year the Association of Mortgage Intermediaries, the Intermediary Mortgage Lenders Association and the Council of Mortgage Lenders published “Working Together: an industry guide to lender and intermediary accountabilities and responsibilities in mortgage sales and servicing”.
“That document would have been inconceivable 18 months ago,” says Stephen Smith, director of housing and external affairs for Legal & General. “At that point it felt like everyone was still in their own trenches lobbing bombs at one another.
“The past nine months and the delivery of that document have forced advisers represented through AMI and lenders represented through the CML and IMLA to get around the same table and think about what’s in the best interests of consumers.”
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