The Analysis News & Opinions


‘Lending growth is going to come from remortaging’


Mortgage lenders that want to see growth in 2017 and 2018 should prioritise their existing customers, according to a senior industry analyst. Robert Sinclair, chief executive of the


Association of Mortgage Intermediaries (AMI), said: “If you are going to get business growth in 2017 and 2018, it is likely to come from the remortgage market. That means you have to talk to existing clients.” Speaking at the Financial Services Expo


Glasgow, Mr Sinclair said intermediaries were likely to see growth in overall market share in the next few years, but technology would have an impact. “I see the intermediary market share as being incredibly powerful, but technology might get in the way,” he said. “In terms of gross mortgage lending, a figure of around £250bn per year is probably about the right number. Intermediary share will continue to rise upwards.” He highlighted issues that could impact on


the mortgage intermediary and their ability to provide the right advice to their clients. In particular, he stressed ‘the hidden market’ of product transfers which, he claimed, lenders were not detailing. “Does the customer understand this, and are they aware of what they are getting by conducting a product transfer?” he asked. One further issue which he said AMI was


speaking to both the Council of Mortgage Lenders and IMLA about was that of lenders’ withdrawal of binding offers. “My view of the market post-Mortgage


Credit Directive (MCD) is that, unless there is a fraud or a fundamental change of circumstances, then that offer should be binding. I see that as being a change to the customer’s circumstances, but I am seeing cases where the lender, or the valuer, has done something wrong and then the offer gets withdrawn.” He hoped that all lenders, in these


circumstances, would understand the potential damage that was being done to customers and that they would have already spent a significant amount of money prior to the offer being withdrawn.


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He concluded: “If I am honest I think


there are probably too many lenders at the moment. Greater competition does equal greater pressure. I think they will take more risks, which is good as many were too conservative, but the big question is: how do they take that risk? Brokers need to understand that the lenders will cover clients who are more at the edges of the market.” Meanwhile, the second-charge lending


market has plenty of scope to develop, but needs to further develop the education of customers if it wants to grow, the event heard. Alistair Ewing, managing director of


The Lending Channel, said: “Seconds are a mile away from where they need to be. It is a niche market of course, but it needs to be a bigger niche market. The influx of business we might have expected post-MCD has not happened and we need to do a better job in terms of educating the consumer. For some, it is still seen as a loan of ‘last resort’ and that is not the case. “The market has not gone far enough


yet. We have loads of brokers on our panel who still will not consider seconds, despite our efforts to educate them. It needs to grow.”


Utilities up for debate


As the utilities and telecoms sector continues to look to the future, CCRMagazine and Equita will produce a high-level debate looking at the prospects for the sector. The debate will allow senior professionals


to consider current regulation and best practice on how creditors and collectors can work with their customers to facilitate the best possible outcomes. Stephen Kiely, editor of CCRMagazine,


said: “The utilities and telecoms sector plays such an important role in today’s society,


www.CCRMagazine.co.uk


providing many of the services that we rely on most. So there is a real desire to decide on strategies for how to make the best decisions for the customer, so I am delighted to be working with Equita on this important and extremely timely debate.”


April 2017


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