As a regular reader of Money Marketing who is not a financial intermediary
by profession, I am always rather staggered by the amount of criticism
intermediaries direct at the service delivered by product providers such as
insurance companies, mortgage lenders and investment houses.
If I believe what I read, then literally hundreds of companies are
disappointing intermediaries either because:
Their service is slow.
They do not understand what the intermediary wants.
Their procedures and requirements are too complex and unnecessarily cumbersome.
Even the product providers themselves are getting in on the act.
In Money Marketing a few weeks ago, the managing director of a “niche”
lender was quoted as saying that his company was gearing up to add further
resources to its operations to provide the very best service to his
He was doing this because outsourcing to specialist service providers, as
some of his competitors did, was just not good enough and its needed to
control the process itself in order to deliver what the intermediary market
required. What total rubbish.
As any intermediary worth his salt will tell you, it is not a question of
where or who does the admin that is important but rather how the service is
structured and delivered that really determines whether it hits the target.
Intermediaries can cite the example of numerous organisations which are
100 per cent sourced in house but whose service delivery still leaves a lot
to be desired. As a representative of a large outsourcing company, some
might say, well, he would say that, wouldn't he? However, I am not trying
to compare insourcing versus outsourcing because in my view that is a
What I can say is that, in my experience, we need to define the difference
clearly between the concept of service and issues of policy and accept that
to deliver a good service to an intermediary and their ultimate client, we
need to agree t the process is a two-way street.
Let me explain. At HML, we are specialist mortgage administrators and that
is all we do. We are not distracted by issues of product marketing,
selling,regulation or ancillary product servicing such as in the arena of
savings or insurance. We work with over 30 different lenders, large and
small, niche and mainstream, across every spectrum of the mortgage market
covering prime, sub-prime, commercial and specialist loans.
Over 10 of our lenders are actively originating loans into our platform or
systems. We have our lenders' underwriters and other staff based in our
We accept business, retail, wholesale and in great volume from
intermediaries. In short, we can view this problem from a rather unique
perspective and over the last quarter our analysis reveals the following
Over a quarter of applications received from introducers are incomplete in
terms of simply answer-ing the questions asked on the forms.
A similar number are submitted on the basis of not complying with the
lender's underwriting and product criteria. Over 50 per cent of all
reports/certificates on title submitted by solicitors are incomplete. This
delays and frustrates the efficient transfer of funds as part of the
process of completing the loan transaction.
Now, as most intermediaries will accept, lenders need information in order
to assess risk. Application forms are designed to elicit that information
although many,I accept, are incomprehen-sible and need far better design
and much less jargon.
But undoubtedly a staggering number are submitted for lender consideration
without the information needed supplied. This necessitates a to-ing and
fro-ing between the lender and the intermediary, leading to argument and
delay. Also, why submit a loan if you know it does not fit the criteria?
Sure, there is always a case for a considered view to be taken by an
underwriter but this can always be done over the phone, so why submit an
application form that will initially almost be guaranteed to be declined?
The final area in this service argument revolves around the key difference
between process and policy. Process is easy to define. It is simple matter
of resource, workload and systems.
If we as a service company get any of these three key aspects wrong, then
intermediaries will suffer because our delivery will fall down. But this
has nothing to do with policy, which tends to be more focused on the type
of risks accepted and upon what terms.
We regularly visit our clients' introducers to seek their comments on what
we do and where there are concerns and we endeavour to investigate and
report back on those concerns. Our research has shown that what many
introducers have labelled a service problem is in fact a lending problem.
“This applicant has been rejected for this reason” is an issue of policy
and does not always mean that the service from that lender is poor. It may,
in fact,be excellent but, very simply, the message given is not one you
want to hear.
Dealing with a mortgage lender is not like buying any other service. It is
not like buying a car, a holiday or any other tangible product. You cannot
just go in and buy it, even though in many ways mortgages are now highly
You have to present your proposition clearly, effectively and
comprehensively and the lender must do all it can to ensure you are
properly advised, updated and informed about its products as well as the
terms and conditions.
One side of the equation cannot work without the other. Sure, let us all
continue to invest heavily in clever systems to facilitate easier access
and to design better products but let us not forget that true service comes
from getting the basics right.