Brokers supporting re-mortgaging

While lead sourcing will be a perennial issue (and one that I discuss in another blog), the majority of brokers that I speak with are looking for ways and means to maintain lasting relationships with their clients.

In effect, this trend marks the emergence of one of the most novel elements of the digital economy - a shift from product ownership to a service or subscription-based model. A subscription model particularly suits DAs because of the surge in remortgaging that has characterised the UK mortgage market over the past year. Record-low interest rates and increased customer awareness of the benefits available to them by switching products has meant that, according to Mintel’s 2017 Mortgage Market report, remortgages grew in value by 20% in 2016 alone.

Since 2009, some estimates of remortgaging activity have more than doubled as a percentage of the total market. In June 2017, about a third of property valuations originated from homeowners or landlords looking to remortgage.

This trend is also starting to impact best practice at lenders. Up until recently, lenders were widely criticised for poor client communications, especially how they alerted a customer to the end of a product’s fixed-term rate. Halifax had long led among lenders in encouraging best practice in client communications and, as a result, they also led the way in terms of client retention. Increasing numbers of lenders are following suit as regulators and the government focus on improving consumer access to the mortgage market.

So where do we go from here?

The process of remortgaging needs to get smarter. Customers should receive genuine support so that they can not only change their rate, but also identify different maturities, fees and products that better suit their changing financial conditions.

With the right technology, brokers can do more, for example, to help a customer identify the best possible product for their credit profile. Rather than choosing the path of least resistance and advising a client to stick with the same lender to avoid additional paperwork, we’ve designed MortgageGym Pro to automate the most time-consuming processes brokers handle daily.

One of the first steps supporting DAs to succeed and flourish, is to help solve this critical problem of client retention over the short- and long-term.

Written by Grant Hendry, Head of Community, MortgageGym

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