FR: Landbay recently launched its product transfer proposition. How has this been achieved?
We were really pleased to launch our product transfer proposition recently, as we know how important this is for our broker partners and their clients. We wanted to ensure that we offered the best digital experience possible, so it is something that has been a long time in the making. The product and engineering team has been working hard behind the scenes to build a solution that works for a business like ours and in this segment of the market. It is well known that product transfers can be a complex proposition to offer in the specialist buy-to-let space, but our team has done a brilliant job to build, test and deploy a solution that is fit for purpose and has already generated some really positive feedback.
Key to delivering this has been leveraging, and enhancing our own in-house technology and existing broker portal. Building this within our existing eco-system means brokers can check eligibility within the platform and have an online application process that utilises automated decisioning and property valuations. It also means borrowers have slick digital interactions by accepting the application via email and signing the updated loan documents online.
FR: What are the benefits of a buy-to-let product transfer?
While there’s much talk about mortgage retention in the residential market, we cannot forget that this is hot topic in the buy-to-let space too. Some landlords are coming to the end of perhaps more favourable rates and seeing not just an increase, but stress rate challenges with other lenders too. That’s on top of other elevated operating costs they are experiencing.
For those without significant changes in circumstances, product transfers can provide a more efficient option with reduced costs. The problem has previously been that they have not always been readily available among buy-to-let lenders, or covering all property types such as HMOs or MUFBs.
The ability for brokers to be able to offer their clients these efficiencies is hugely valuable in the current climate. Plus, PTs can offer other cost efficiencies such as no legal fees – unlike remortgaging - and through Landbay, the option for automated valuations to avoid valuation fees too. These cost savings are even more important for landlords with several properties in their portfolio, where remortgage costs can quickly accumulate. There is also the time saving by avoiding a full remortgage application – with brokers able to complete a product transfer in just a matter of minutes. Timing is everything in the buy-to-let space, so it is an important addition to a broker’s arsenal.
FR: How do product transfers fit into a broker’s retention strategy?
While we often think of PTs being important to a lender’s retention strategy, it’s also key to a broker’s strategy too. Today’s market requires brokers to have access to broad and competitive range of products to support landlords of all sizes with a diverse range of requirements. Product transfers absolutely fit into that offering, particularly given how much the market has changed since those landlord clients took out their deals.
Just as important is allowing brokers to think about their long-term strategy with that client. We know brokers will be less inclined to put forward a case to a lender if there isn’t a way to support that client on the back end. As demand for PTs increases, it’s an important consideration for a broker when weighing up which lender is the best fit for new business. While quality and speed of service is clearly critical in the beginning, there also needs to be options further down the line. We’ve seen many industries focus on winning new business which ends up resulting in new customers being treated better than existing customers. This is something that we need to avoid within buy-to-let lending, and should shift the focus to treating existing, performing borrowers better.
FR: How will technology continue to shape the buy-to-let market over the coming 12 months?
The buy-to-let sector is improving when it comes to innovation and integrating new technology. In today’s market, a tech-first approach is absolutely critical as it means lenders can be more agile and respond to the market and client needs much faster. We’ve certainly seen this through the likes of our own broker portal and increasing use of automation to improve visibility and communication.
The big focus for the market in the next 12 months will continue to be AI, open banking and automated valuations. This will play a key role in providing powerful insights and decisioning that can be used throughout the mortgage process. It is important that we continue to drive efficiencies and add value to all parties involved in the process, whether that’s in application, underwriting, conveyancing or in product development itself.
There’s no doubt lenders should be pushing forward with digital transformation to overhaul outdated processes and improve the experience for all parties. We should remember to still take a business problem and outcome first approach, rather than forcing the use of new technologies without understanding how and why we are looking to use them, and the impact it has on brokers, landlords, and lenders.
