Guide to BTL remortgaging in 2021: Mortgage market service
Jonathan Stinton is head of intermediary relationships at Coventry for intermediaries
There are already signs that last year’s wave of demand from home buyers is continuing in 2021. New figures from IMLA predict that the mortgage market is set to grow to £283bn in 2021, and while lenders, intermediaries and others are keeping busy in the run-up to the Stamp Duty holiday deadline, the sector is also facing a spike in remortgage activity.
In the last of a series of articles, I will talk about why the impact of this demand on service last year might now also leave brokers facing questions and concerns from remortgaging buy-to-let (BTL) customers.
FAQ No. 4: “How long will it take me to remortgage in today’s market? How can I make sure my remortgage application is processed quickly?”
Getting the best deal and the right product for your clients is often the key focus for you as intermediaries and that’s certainly going to continue. Britain’s landlords have faced a spate of tax changes over the last five years, from the stamp duty levy on second homes to the reduction in mortgage interest tax relief. Others will have also had to face up to the implications of the Coronavirus crisis, such as managing tenants on payment holidays and perhaps even taking a payment holiday themselves.
All this means that many landlords are going to want to ensure they have the best deal on their next mortgage to help them keep costs low – now more than ever.
But amidst the unprecedented demand we’ve seen in the mortgage market over recent months, BTL customers who now need to remortgage could increasingly be seeking a better deal when it comes to service too. What they’ll want is a hassle-free remortgaging journey that avoids the delays and provides them with the right solution, and a swift answer. Now’s the time to expect questions about the mortgage timeline for lenders that have been affected by demand. How as intermediaries can you tackle these questions and concerns about mortgage market delays?
Firstly, there are lenders eager to work together with intermediaries to help you get ahead of changing criteria and know exactly what information you need for your clients to proceed. At Coventry for intermediaries, we like to keep our criteria simple – for example, we focus on ICR calculations and for portfolio landlords we use a simple spreadsheet to support our underwriting – no business plan is needed.
With the mortgage market remaining busy this year, your landlord clients will want the peace of mind that their application won’t get lost in the noise either. As intermediaries, you’ll want to be confident in the lenders you’re recommending to your clients to help you build and maintain strong long-term relationships. You’ll want to know that not only is a lender the right fit for your customer’s circumstances, but they also have the service to back up their promises and meet your client’s needs swiftly.
The good news is that not all lenders are facing severe delays in the mortgage journey. There are those out there who have adapted to the current high levels of demand and are continuing to deliver the service your customers expect. For example, at Coventry for intermediaries we’ve focused on stepping up our service during the crisis and working together with intermediaries. Between 1 November 2020 and 31 January 2021, we answered new enquiry calls in an average of just 39 seconds, allowing intermediaries to kick-start the conversation with us quickly. We also achieved an average offer turnaround time of 14 days, ensuring brokers got a response for their clients to carry their plans forward.
Lenders also publish service standards to give a transparent view of performance, and there are other tools which can give you a snapshot of what service levels look like across the market. Similarly, there are platforms which collate lender product and service information for you.
The impact of high demand in the mortgage market is just one concern that will be on the minds your Buy to Let clients this year, particularly when it comes to remortgaging in these uncertain times. But what is clear is that many people are going to be relying on your advice and expertise now more than ever and together – lenders and intermediaries – we’ll need to work in partnership to support these customers with their remortgaging needs in the months ahead.