"There are many product areas for us to potentially expand into but this will only happen when the timing is right for the business and when we feel we can add real value to landlords and the intermediary marketplace."
We spoke to Ross Turrell, commercial director at CHL Mortgages, about the lender’s return to the specialist buy-to-let market, the opportunities and challenges it has faced, what intermediaries need to know about the proposition and its plans for the future.
FR: Why did CHL Mortgages return to buy-to-let lending after 13 years?
Whilst we ceased originating mortgage business in 2008 due to the ‘Credit Crunch’, we have continued to be very active in the capital markets with an ongoing securitisation program as well as our major shareholder purchasing a number of large mortgage books.
Acting as a servicer on both our own and third-party assets ensured that we maintained a strong understanding of the shifting dynamics and emerging trends across the buy-to-let market. Timing is everything. We have been closely monitoring the growth trajectory of the specialist buy-to-let market and our relaunch has been carefully plotted. As a business, we have spent a significant amount of time and resource ensuring that we have the infrastructure in place to support a return to lending and successfully service the ever-changing demands of landlords and our intermediary partners.
FR: What opportunities and challenges did you face relaunching during a pandemic?
All new and established businesses across every sector faced their own fair share of challenges over this tumultuous period. There were times when we all had to feel our way through this and adapt quickly in line with government guidance and market demands.
For a ‘new’ entrant, it was vital that we had a vastly experienced and well-connected team in place to forge important relationships across the intermediary market on a remote basis. This was also helped by strong brand recognition, alongside our reputation and long history operating within the buy-to-let arena. In terms of market conditions, ultimately, we remained confident in the strength and stability of the UK housing market and robust nature of the buy-to-let sector. Confidence which has been justified as we have experienced no let-up in demand since our relaunch.
FR: What would you like intermediaries to know about your lending proposition?
We are a specialist lender and our current focus is squarely on the BTL market. With competitive rates and strong criteria we are particularly suited to portfolio landlords, many of whom are utilising a limited company structure.
We are not trying to reinvent the wheel; our proposition is all about competitive pricing and broad criteria aligned with a modern digital infrastructure to create a positive experience, a best-in-class service and deliver tangible benefits for our intermediary partners. From a funding and operational perspective, we are working from a very solid base and the strength of our funding position gives us the opportunity to further develop our proposition, at pace, when and where necessary.
FR: Do you plan to diversify into other product areas?
We are always open-minded when it comes to new product areas and we are constantly evaluating our options. There are many product areas for us to potentially expand into but this will only happen when the timing is right for the business and when we feel we can add real value to landlords and the intermediary marketplace.
At the moment, we are focused on ensuring that our current proposition is fully bedded in, that we are delivering consistent and reliable levels of service and are communicating effectively with our distribution partners. It’s all about establishing a solid platform from which to build.
What I can say is that we are planning to further expand our criteria later this year. So watch this space.
FR: If you could read one headline from the Autumn budget, what would it be?’
'Chancellor reverses the unfair taxation of buy-to-let landlords'. It’s something of a long shot but it’s time to stop penalising landlords and recognise the vital part they play in this nation’s economy.