"Don't ignore seconds. They're a really, really good and very simple way to sort of make more money and get that stickier customer."
- Adrian Moloney, OSB
Brokers need to diversify their offerings, improve knowledge, and leverage specialist lenders to better serve clients and adapt to market changes, a panel of experts at the recent Mortgage Adviser Event Manchester agreed.
Speaking in the Modern Lender seminar theatre, the lender spokespeople agreed that the traditional buy-to-let market is evolving, but not dying, as Adrian Maloney from OSB said: "I don't think you see the death of the traditional buy-to-let, because, of course, you've still got families that want the rent properties, and you've got landlords that don't move away from their model if their model is successful."
However, diversification is key in the buy-to-let market, with growth in areas like HMOs, holiday lets, and semi-commercial properties. Andrea Glasgow from Hampshire Trust Bank commented: "If we look at our types of clients, we've had a phenomenal year, but it certainly isn't with the straightforward, vanilla buy-to-let properties or landlords. It's those that are looking at it could be your first time buyer, first time landlords. It could be those that are looking at semi commercial."
The panel also agreed that second charge mortgages are an underutilised product that brokers should be considering more. Rob Barnard said, "If you've got any customers that are walking into your office or picking up the phone and they've got a capital raising need, you should be having that conversation with them. It's not a choice. It's something that came back in in 2016 in that any capital raising situation, you have to consider a second charge alongside a remortgage to make sure it's the right outcome."
Brokers should embrace specialist lending and not be afraid to reach out to lenders for support and education, Adrian Maloney said, adding: "Don't ignore seconds. They're a really, really good and very simple way to sort of make more money and get that stickier customer."
Barnard added: "I've seen more innovation in the last six months than I've seen in six years. We're making it more simple, easier to transact that business. You might lose the customer for life by being closed off to a market, which I think is a brilliant solution in the here and now."
Maeve Ward from Together told brokers: "If you're if you're looking to diversify your products, to provide as many solutions as possible to your customers, whether you own that yourself, or whether you refer to a specialist, just don't do nothing. There are experts out there that can help you and create that awareness and give the tools that you need, because that's what's going to set you aside from your immediate competition."
Gavin Diamond from Inspired Lending agreed, stating: "You don't necessarily need to be the expert in that opportunity, but you need to be able to identify when a second charge mortgage or a bridge or some other specialist product could be appropriate. I think that's absolutely vital, because the number of times where clients aren't getting the right advice and get put into a product that isn't the right product for what it is that they actually need, then just becomes kind of a downward spiral, and they'll end up going to the bridging market to bridge them out of the wrong product in the first place to allow them to get onto the right product. So please just be aware. Improve your knowledge in order to improve your client journey. Your client journey includes all aspects of lending, whether it's something you've done 15 times over, or something you've never touched before. There is a specialist lender or a packager or a field sales BDM that's willing and happy to support."
"Ignore specialist lending at your peril", Rob Barnard concluded.
