FR: How will upcoming regulation and a potential rate rise affect brokers and the wider lending market?
Any disturbance in the market, whether it’s a new regulation or a rate rise, heightens the need for advice. During times of change, customers often need additional help, and it is the broker’s responsibility to provide this support. Being proactive, rather than waiting for a customer to call, will build trust and protect a broker’s relationships from competitors.
Many customers have never experienced a base rate rise, so the broker’s role in terms of offering reassurance and suggesting different ways of saving money is vital. Brokers shouldn’t wait until rates go up to start these conversations, however – they should be raising these issues now.
FR: How will technology affect the way advisers, lenders and clients do business?
Technology is potentially one of the biggest threats – and opportunities – for intermediaries. Using technology to offer a better service, improve efficiency and attract younger customers will help firms to thrive. Conversely, firms that choose to ignore these solutions will soon find that their clients will seek other ways to transact. Whilst the need for face-to-face advice is still paramount for most customers, the majority will want to deal with slick, modern and tech savvy intermediaries who make things easier for them. Disruptors will continue to join the market, so established firms need to be proactive to make sure their customers don’t slip away.
FR: How can mortgage clubs help to support advisers and the wider financial industry?
At Legal & General Mortgage Club, our basic role is to ensure that brokers have the widest range of lenders, products, exclusives and a good procuration fee. In reality, however, our job is much broader. We also provide access to other important markets, such as later life lending, conveyancing, second charges, packagers, bridging and commercial lending and protection. In addition, we lead the market in education and information for intermediaries whilst lobbying lenders, regulators and trade bodies on key market topics such as regulation, procuration fees and lending criteria.
FR: What more can be done to address the issue between housing demand and supply?
We need to build more houses, in the right locations, with the right infrastructure to support them. This is not just traditional housebuilding; we also need to free up properties from older borrowers to allow them to rightsize – maybe by offering tax breaks – and look at new construction methods to speed up the process of bringing new properties to market. Legal & General is supporting the UK in delivering all of these changes as part of our Group priorities.
FR: What will be the most significant changes in the industry over the next 12 months?
We will see a gradual return towards innovation as lenders start to free up resource and IT capacity post-regulation. New lenders will help in this regard, as they will look for new customers, coupled with an increased focus on secured loans and later life lending. The main change looming for the industry, however, is the pace of technology and disruptors such as robo-advice, which will continue to streamline the advice process. Brokers will therefore need to invest and react accordingly in order to keep their business relevant. By offering a slick, service-driven, holistic proposition to customers, competitors will not be able to gain a foothold into an established firm’s client base. Today’s intermediaries need to be proactive, service all needs, and take steps to futureproof their business right now.
