Broker satisfaction with lenders edges closer to pre-pandemic levels

Broker satisfaction with lenders edges closer to pre-pandemic levels

Brokers’ satisfaction with their mortgage lenders has grown 2.5 percentage points since the end of last year.

Satisfaction now sits at 80.3 per cent, compared with 77.8 per cent six months ago.

The last 12 months have seen the broker-lender market endeavour to recover from the strain put on its relationships by the pandemic. 

“Lenders were making significant changes to their product criteria and taking far longer than usual to process cases because of the need to tackle the application backlog that had emerged,” Craig Hall, Legal & General Mortgage Club’s broker relationships head, told FTAdviser.

Pre-pandemic, broker-lender satisfaction levels were at 82.70 per cent, according to data from Smart Money People. The research is based on 597 mortgage brokers’ responses concerning 44 mortgage lenders.

“I don’t think anyone was happy with lenders early in the pandemic,” said Chris Sykes, associate director and mortgage consultant at Private Finance.

The global health crisis saw swathes of lenders withdraw flexible criteria, particularly impacting the self-employed, and those whose salaries heavily relied on bonuses.

But in the last six months, Sykes said “lenders have become more understanding of the self-employed and how they work, dealing with them on a case-by-case basis”.

Some high street lenders have also launched products specifically designed to help first-time buyers with smaller, or less orthodox streams of income.

In April, Nationwide unveiled its ‘Helping Hand’ mortgage, which allows first-time buyers to borrow more than five times their income for 5-10 year fixed rate products up to 90 per cent loan-to-value.

As well as the re-emergence of more flexible criteria, Marc von Grundherr, director of estate agent Benham and Reeves, highlighted the role “rising house prices and transaction levels” have played in growing broker-lender satisfaction.

The latest Office of National Statistics data shows property values were 10.2 per cent higher in March than a year earlier. This marked the fastest annual rate of growth for 14 years.

In terms of residential transactions, HMRC data showed there was a 179.5 per cent jump across the UK in the year to April 2021. The government body counted 117,860 transactions for April 2021, compared with 42,160 in April 2020.

But von Grundherr acknowledged that these developments were still leaving some of the market behind. “The fact that one in five brokers remain dissatisfied with lenders implies we’re yet to achieve complete mortgage sector utopia."

Author of the research, Smart Money People, also cited poorer customer service and underwriting as reasons for the pandemic-induced decline in satisfaction.

Kate Davies, executive director at the Intermediary Mortgage Lenders Association, said: “Lender improvements to application processing times have been instrumental in remedying the relationship with advisers."

She added technological innovation would play a "fundamental role" in allowing advisers to access timely and accurate case updates as staff make a gradual return to in-person working.

L&G's Hall agreed that businesses entered 2021 “much better equipped” to deal with remote working, and that technology “has also helped to make it easier for advisers to connect their clients with suitable lenders”.