"The innovative nature, flexibility and increased product diversity being demonstrated by building societies will support a growing number of potential borrowers and existing homeowners"
The lending arena has always evolved at pace, but this has become even more evident in the face of a raft of unprecedented obstacles and challenges. Inevitably, technology has played a major role in overcoming many of these issues through the introduction of desktop valuations, two-way Decision in Principle (DIP) integrations and significant upgrades to mortgage processing platforms, amongst other tech-driven initiatives.
Here at Hanley Economic Building Society, we are in the midst of journey which began in April 2020 to completely overhaul our current mortgage and savings platforms, as well as revamping our back-office systems. This is a transition which will make us ‘fit of the future’ to ensure we can better reflect the innovative nature of our product range and meet the ever-changing needs of the UK population and the intermediary marketplace.
These shifts in personal and financial circumstances reflect some turbulent economic times and many life changing events. Life is a complicated chain of incidents at the best of times and this has really been brought home to roost over the past 12 to 18 months. Whilst nobody wants to think of events which may put a strain on their short or longer-term financial position, these things do happen and finding a lender who can facilitate such change isn’t always straightforward. Supporting customers who have had to endure a life event has always been very mutual thing to do and this is something which the intermediary market appreciates.
This fact was emphasised in research from broker forum Cherry which focused on service within the building society sector and how product offerings were being utilised. As such, it was interesting to see that, when it comes to smaller building societies, participating brokers said they use them for a range of different types of cases. The most popular was adverse credit, which was cited by 15.8% of brokers, while 14.9% said they used smaller building societies for cases involving self-employed and contractors. A further 12.4% use them for joint borrower, sole proprietor and 11.5% for later life lending. Other types of cases named by brokers included holiday lets and second homes, interest only, non-standard construction, self-build, guarantor, and professionals. More than four in 10 brokers (43.8%) said they expect to see their business with building societies grow in 2021, with just over half anticipating it to be about the same. Just 2.5% said they expect to do less business with building societies this year.
This data certainly bodes well for an array of building society offerings in H2 2021 and beyond. The innovative nature, flexibility and increased product diversity being demonstrated by building societies will support a growing number of potential borrowers and existing homeowners who may have encountered difficulties over this tough time. For those borrowers who have been fortunate to emerge from this period financially unscathed, even better off, they also offer a place to grasp opportunities in some of the areas mentioned above, notably self-build in our experience. And it’s clear that the building society sector as a whole will continue working hard to generate opportunities and responsible solutions for an array of borrowers and intermediary going forward.