"The Society has already started a project to enhance its online system and improve the efficiency of the main processing systems"
FR: You've recently taken over as joint heads of mortgage loans underwriting at Family Building Society. Tell us more about the role and the structure of the department.
The loans underwriting team is some 24 strong and is core to the Society's lending policy. 95% of applications are introduced by intermediaries, mainly independent mortgage brokers, who are supported by the Family's growing team of BDMs. All applications are assessed on a case by case basis and manually underwritten.
FR: In the current lending climate, what are brokers and their clients seeking?
In these uncertain times, the Society takes pride in remortgaging, mainly product transfers, as borrowers come off fixed deals and also offering new loans to those underserved by the major lenders - those coming into and in retirement, the self-employed, expats, and others turned down by them, in many cases because of their age or their life stories that are just too complicated for the major lenders' computers.
FR: Please tell us about you background in the industry?
Blaine Faragher: In my long and varied career I have experienced many highs and lows - the abolition of MIRAS, mortgage regulation, the global credit crunch and the devastation that followed. 2008 was a very tough year for the industry. And now inflation and the increased cost of borrowing is proving very challenging.
Phillip Townsend: Previously, I had worked at Lloyds Bank, at Halifax as an in-house mortgage adviser before joining the Bank of Ireland's underwriting team, where I was also a PPI complaints investigator.
FR: And also about the culture and approach to underwriting at the Family?
Blaine: I love the look and feel of the Society and the people who work here. There is a care and love of what we do instilled from the top down by CEO Mark Bogard. People genuinely care about their jobs and how they do them. Our ability to offer bespoke underwriting is the antidote to the ‘credit score mentality’ the high street offers. We can listen and apply common sense to the decisions we offer to brokers’ clients. We see such an array of clients too, from old ladies applying for a £45,000 release of some equity to ex-footballers, City big hitters and other tycoons seeking £10m plus mortgages. We serve so many different people living varied lives which I find very interesting. It’s not mortgages we deal with; it is homes and aspirations after all.
Phil: Whilst the giant lenders might process thousands of straightforward applications digitally and quite promptly every day, brokers do come to us with less straightforward cases. Our manual underwriting takes more time, which can be frustrating for both brokers and their clients, rushing to complete a deal against a tight deadline, but it is very rare that we can't find a solution. Our innovative thinking and striving to find suitable, appropriate loans for the more complex cases brokers bring in is very important. And well received. Fortunately, we take a conservative view on stress testing loans and this has meant very few borrowers in arrears and default in the current market.
FR: How does the process work?
Blaine: We operate a non-credit scoring underwriting process using people, not computers, to assess cases on their individual merit. The Society has an online system which enables introducers to submit applications online. Applications need to be supported by a minimum set of documents before underwriting commences (such as proofs of income, bank statements, ID etc.), but the application and the supporting documentation is reviewed by an underwriter who is responsible for the case from start to finish."
Phil: The Society has already started a project to enhance its online system and improve the efficiency of the main processing systems to aid the underwriter in processing applications more swiftly. These improvements are part of the Society’s strategy to boost the amount it can lend over the forthcoming years and to expand into new product areas.