Broker flexibility helps them steal market share
His comments follow data from the Council of Mortgage Lenders which showed brokers’ share of the market has increased by over seven percentage points in the past year to 69% in the second quarter from 61.9% in Q2 2014.
Murphy, head of lending at Mortgage Advice Bureau, said the success of brokers in taking market share from branches could be partly attributed to their ability to be flexible about using all forms of social media to deal with clients and the fact they are prepared to work on a Sunday and late at night to get deals done.
He said: “Brokers have always been adaptable, especially after the financial crisis when it was essential in order to survive.
“When transactional activity was thin on the ground in the period between 2009 and 2010, if a broker had the opportunity to do business with a client on a Sunday or during the evening, they would not turn down the opportunity as they wanted to provide a great service for their clients and they needed the business.
“The market has moved on exponentially since those tough days and currently brokers are once again writing the bulk of the business within the mortgage market.
“However, this is also due to the fact that they continue to meet and talk with their clients either face-to-face or via telephone, email, Skype, text message or via social media.”
Murphy said the shifting dynamic was also a result of the Mortgage Market Review requiring the lion’s share of mortgage business to be advised.
He said: “One of the issues that has faced high street mortgage lenders – particularly since the introduction of the MMR and the need for advised sales in almost all scenarios – is the lack of suitably resourced and qualified advisers available to suit clients’ needs.
“If a client has a pressing mortgage requirement the adviser may not be available at a time that suits the work commitments and lifestyle of the client.”
Research released earlier this month by Mortgage Advice Bureau showed 40% of people looking to remortgage do research online between 10pm and 6.59am.
Just 23% search between 7am and 11.59am, 22% between 12pm and 4.59pm and 14% between 5pm and 9.59pm.
Murphy said: “Brokers act on behalf of their customers so it is not surprising that by nature they are available at a time and place that is convenient for their clients.
“Mortgage lenders on the high street, usually banks and building societies, tend to have their opening hours governed by historic hours of trading and branch security factors.
“In general, brokers will conduct their appointments within their own premises, or sometimes at an estate agents or a new homes site. In addition to this, brokers will work around their clients’ needs and preferences, whether that is a face-to-face meeting, a telephone or email conversation, or a combination.
“This may include a face-to-face visit at the clients’ home, their place of work or other suitable meeting points such as a hotel reception or coffee shop.
“Many people’s work patterns are no longer undertaken in a regimented 9am to 5pm regime –the usual hours that the high street lenders are open.”
Increasing numbers of high street mortgage lenders are adopting a more customer-focused and flexible approach to Saturday opening hours. However, these are often fairly constrained and governed by the opening hours of the branch.