So the property market is flying, buyers and sellers across the country are making life-changing decisions and eagerly looking forward to their new future in their new homes. What could possibly spoil it?
Enter mortgage lenders and credit teams…
I could very easily go into rant mode from both personal experience and business experience. I’m buying and selling myself currently, and both I and my buyer have had farcical experiences with lenders. There are 3 key issues I can see;
In a busy market, they are busier than normal with applications, but how can you possibly get to a position where an application doesn’t even get looked at for a fortnight or longer. Where subsequent reviews of the case come with a further delay of weeks, not days. How can organisations of their size not be geared up to be able to manage their pipelines in a more effective way? It’s not like there is a shortage of people they could recruit currently based on redundancies going on in the country.
And yet I have seen first-hand letters from major lenders to brokerage set ups saying they can’t cope with more business and maybe we ‘aren’t the lender to use currently’.
Attitude to self-employed
It’s never been great but currently, post-Covid19, many have zero appetite to lend to anyone with their own business – which is 5 million people or 15% of the workforce. They are looking for reasons to decline a case and what smarts so much is that this could very well be people who run extremely tight ships and successful businesses. Ships that I would beg to suggest may well be running a good deal better than their own set ups where they are losing business and turning away business because they can’t manage the volume.
My own current lender of 4 years were so impossible to please, despite what my broker described as a ’fantastic case for someone’, that I had to go elsewhere but pay them a redemption fee of several thousand pounds to do so. I tried everything not to leave them, they simply didn’t want the business. How can that be right I have to pay them a penalty as a result? It’s scandalous.
So many transactions are being put at risk, delayed and having increased stresses attached to them and the blame is firmly and squarely at the feet of lenders. And that’s not failing to appreciate they obviously have to do their appropriate due diligence and have an attitude to risk and so on… it’s the hypocrisy with which they judge business when they are palpably failing to manage their own business. They certainly shouldn’t lend to themselves currently!!
It also feels like there is an absolute arrogance about the client needing them more than they need the client. That’s a distinctly unhealthy way to run a business, to fail to respect your customer. And then don’t respect them with words and rhetoric, but with actions. If I see another bank TV ad telling me how they are part of the community and offering outstanding service I’m going to throw something at the TV!
Currently brokers are having to chase the life out of them and generally getting moaned at for that chasing – yet if they had any smattering of service obligation they would have systems in place to provide the updates without needing chasing. They are totally reactive, not proactive.
I realise I have indeed gone into rant mode after all – it’s hard not to get passionate about it when you see how many people are being affected by their failings.
- Sort your recruitment out
- Don’t treat self-employed as lepers
- Proactively provide regular updates, by way of service, to those paying thousands of pounds to become a customer of yours
It won’t happen of course, but I feel a tiny bit better getting it off my chest.