"Over the past five years, the industry has seen a multitude of regulatory changes and it is vital intermediaries keep on top of these."
We spoke to Lisa Martin, development director at TMA Club, about why later life lending will be the fastest-growing market sector and why brokers should not fear change.
FR: As development director at TMA, what does your role involve?
I am responsible for the sales, marketing and operational functions at TMA, as well as overseeing the relationships with all of our business partners. From engaging with colleagues in areas of compliance, risk, finance and technology, to planning our next steps as a business, all aspects of my role require an active and hands-on approach. Our intermediaries are at the heart of each business decision and being part of the wider group’s financial services team, we collectively look to improve propositions and processes for brokers, and seeing these materialise is a hugely fulfilling part of the job.
FR: Which areas of the mortgage market do you think will grow most over the next 12 months?
Later life lending is growing at record rates – £11 million was borrowed by the over-55s each day in Q3 of 2019 alone - and I expect we will see this area of the market grow even more as the UK’s ageing population increases. In fact, from 2019 to 2032 there are an expected 40,000 interest-only loans coming up for maturity every year which lack a repayment vehicle. Whilst lenders are involved in this review, it also means that more advisers are going to be approached by older borrowers looking for solutions to their financial situations.
We’ve also seen healthy first-time buyer activity over the recent years, with a number of initiatives to support this sector. I hope to see this activity continue post Help to Buy and after the Budget. The entire industry will need to work together to build new products and propositions to fill the gap left by the scheme and start to re-educate borrowers on the alternative options available. This will stimulate activity from customers coming off Help to Buy, given the five-year interest-free period will be coming to an end for many borrowers. This may result in a boost in the number of people remortgaging, where property values allow, or even becoming second steppers.
FR: In the current climate, what are the key issues affecting intermediaries?
Over the past five years, the industry has seen a multitude of regulatory changes and it is vital intermediaries keep on top of these. With regulatory demands piling up, brokers who are less comfortable dealing with regulation can gain help, support and guidance from both clubs and networks in different guises. Complying with new rules doesn’t need to be a painstaking process, and change is not something to fear - especially when professional guidance and support is available.
FR: What opportunities does technology present for lenders and brokers?
The opportunities are vast. We have seen an increased amount of technological progress within the industry in recent years enabling faster, smoother and higher-quality processes for lenders and brokers alike. For lenders, new technologies could allow them to make decisions on applications more swiftly, whilst also giving them access to more in-depth financial backgrounds of borrowers.
As for brokers, integrating with the latest mortgage market tech will help them to create a more streamlined advice process. This will allow them to spend less time on admin tasks, such as rekeying borrower information, and more time on getting to know their customers and advising them on the best options available to them. The potential benefits for brokers, lenders and consumers are therefore huge – provided they embrace these opportunities. Promoting the value of both choice and advice is critical in this changing world, especially as customers want to be able to interact with their lenders and advisers instantly and increasingly through digital platforms.
FR: What are your thoughts on the opportunities for women in leadership roles within financial services?
I think that the financial services industry is improving when it comes to providing leadership opportunities for women – though some may argue, we still have some way to go. I feel extremely privileged to be part of the LSL Group where women are hugely visible in senior roles. I am a big advocate of leadership roles being assigned based on the skill sets and capabilities of the individual, whatever their gender.
FR: If you could see one headline in 2019, what would it be?
“Stamp duty abolished for downsizers”.