In the Spotlight with Jason Neale, Magellan Homeloans

We spoke to Jason Neale, Sales Director at Magellan Homeloans, about the supply of affordable new housing and the future of the complex lending market.

Related topics:  In The Spotlight
Rozi Jones
9th December 2016
In The Spotlight
"Most advisers we speak to are amazed to hear about the kind of cases that will be considered by lenders today and that it doesn’t always mean more work than arranging a ‘normal’ mortgage."

FR: What changes has Magellan seen in 2016, and do you have any exciting news or upcoming plans for 2017?

Our focus in 2016 has been on steady, sustainable growth and building an infrastructure capable of delivering a first class specialist lending proposition.   We have therefore expended considerable time, effort and money on making enhancements to our operations, processes and recruiting additional experienced staff.

2016 has also seen us open-up our distribution to give all intermediaries greater access to our products and service. Whilst we continue to value our relationships with mortgage networks and packagers, throughout the year we have also extended distribution by working with directly authorised firms and mortgage clubs. We believe intermediaries should be able to choose how to access Magellan whether it is directly, via one of our packaging partners or via a mortgage club, and we are delighted to now be offering intermediaries that full choice.

2017 will see some exciting changes as we implement improvements to our products, pricing and criteria. We are also making a major investment in online technology which will result in an improved adviser experience. We will however remain committed to manual underwriting, as we believe that credit scoring doesn’t enable us to individually assess and understand applications in a way that gives them the greatest possible chance of success.

FR: Do you foresee the supply and demand issue getting worse? What more can be done to ensure that people continue to have access to the mortgage market?

We live on an island with a rising population so it’s difficult to see demand for housing do anything other than increase. The supply of affordable new housing remains woefully short of demand and this is an issue that requires a long-term solution. It will be interesting to see what policies the new housing minister implements to address the housing shortfall.

In terms of mortgage availability, as lenders we have a duty to continue innovating to ensure customers have access to genuinely useful products that address their specific needs. While funding restraints and to a lesser extent regulation make product innovation more challenging, it would be good to see fewer ‘me too’ mortgage products and more genuinely innovative products that help a greater number of deserving customers secure a home.

FR: How do you see the complex lending market evolving and what more can be done to help non-standard borrowers?

The supply of specialist mortgage products designed for borrowers with complex borrowing requirements is actually pretty good at the moment. The emergence of new lenders like Magellan, in addition to existing specialist lenders widening their product ranges, means there is plenty of competition which is good news for borrowers.

The biggest challenge this market faces is consumer awareness. There are thousands of borrowers who simply don’t know they can get a mortgage, despite the fact a bank or high street lender have said no. The demand for non-standard lending is higher than ever since the financial crisis, so intermediaries who actively seek out these borrowers will discover plenty of opportunity to grow their businesses.

Intermediaries are ideally positioned to help non-standard borrowers. We don’t always have to say no to borrowers with past credit problems and advisers should therefore not avoid this type of business because of the perceived complications of placing applications with lenders. Most advisers we speak to are amazed to hear about the kind of cases that will be considered by lenders today and that it doesn’t always mean more work than arranging a ‘normal’ mortgage.

FR: What are the biggest issues facing the mortgage market in the current economic environment, and what should advisers be aware of when dealing with clients?

Unsurprisingly, one of the major factors affecting the mortgage market is consumer confidence, which may be adversely affected as Brexit negotiations get underway and as president-elect Trump starts to announce and implement his policies in the USA. The degree to which confidence will be undermined will also be impacted by the performance of the economy here in the UK. We live in uncertain times!

This uncertainty and more aggressive retention strategies being implemented by some lenders means it’s more important than ever for advisers to have an effective customer contact programme, to ensure they have regular dialogue with their clients and not just when fixed rate deals are about to mature.

FR: If you could see one headline about financial services in 2016, what would it be?

Homeownership levels rise, as more affordable housing is made available to meet demand.

More like this
Latest from Property Reporter
Latest from Protection Reporter
CLOSE
Subscribe
to our newsletter

Join a community of over 30,000 intermediaries and keep up-to-date with industry news and upcoming events via our newsletter.