There is a growing sense of frustration from brokers at the difficulty in placing and managing mortgages through to completion.
It seems both lenders and brokers would benefit from two-way communication on all things criteria-related. The number of criteria changes and the speed of their implementation is a crucial issue for many brokers, especially when these changes occur without any notice, causing a domino effect as each lender reacts.
Brokers need clarity on the small details that can change the acceptance of a case and lead to a rejection result, meaning the broker must go back to square one. In the absence of transparency on criteria changes, lenders waste time and money trying to process applications that do not result in an offer and brokers risk damaging their credibility.
Lenders are focusing on the quality of the applications put forward, which is central to their business models. With limited volumes, lenders can pick and choose who they want to deal with, so the onus is on the broker to:
- Prioritise quality. Lenders are looking for brokers that can deliver quality, which is important for speed and cost-efficiency. Applications that are fully completed, meet the criteria and have all the correct supporting documentation supplied at the same time is a must.
- Match criteria. This is essential for getting cases through. It is not always easy but it will avoid unnecessary withdrawals, which is a major issue for lenders and brokers. Brokers that often withdraw cases when further information is requested by a lender are playing a risky strategy. Withdrawals entail delays for the client, make the case more expensive to underwrite and flag the quality question with the lender.
Lenders must be clear and transparent on what they need and brokers have to understand the criteria thoroughly, despite the constant changes. Networks and clubs can help with this as they are usually informed by the lender of any changes immediately and are there to provide that information to members.
This approach will not solve every problem in such a restricted market but it will help a lot more cases get through.
Sally Laker is managing director of Mortgage Intelligence Holdings