What a difference a year makes…
Nicola Firth (pictured) is chief executive of Knowledge Bank
With Knowledge Bank having recently celebrated our first birthday I looked back at some things I’d written this time last year and one thing struck me. What I realised after reading previous articles in Mortgage Introducer was that all of the challenges facing brokers that Knowledge Bank was created to help solve were getting worse not better.
As a former broker I experienced the frustration of trawling through criteria spreadsheets, agreeing on a product with a client and submitting an application only to find out that they fell outside of criteria. I also know the embarrassment of having to go back to a client to tell them that the search would have to start again. Client disappointment 1 – Professional image 0.
So, Knowledge Bank was created so that brokers could, at the outset of the case, check their clients’ exact circumstances against the market to find out which lenders would consider them. This meant that there were no nasty surprises, clients’ expectations were managed and often there was a solution from a lesser known lender that you may not otherwise have considered.
What’s changed in a year?
Well, for brokers and clients alike the water has been muddied considerably from even a year ago. There are more lenders, more products and more product innovation (is this code for criteria loosening?) to attract and satisfy more borrowers. This is coupled with a very different socio-political environment with once in a lifetime events such as Brexit leaving people on both sides of the fence unsure about what will really happen over the next two years. Any idea? Nope, me neither.
Coupled with this explosion in product and criteria options, are borrowers with increasingly complex personal circumstances. As a result, we have a situation where, to steal some football nomenclature, lenders are playing the man not the ball. On average brokers are searching on five criteria categories for each client because, as people’s circumstances have got more complicated, lenders have become more detailed about what they will and won’t accept.
I was chatting to a broker recently who perfectly summed up the challenge he faced in placing cases. He said ‘I kind of knew where I stood with lenders a year or so ago but that simply isn’t the case now. Blink and you’ll miss a change in criteria that you thought you knew.’
This is not a unique view and if you dig below this sentiment the numbers don’t lie. We currently hold over 70,000 pieces of criteria from over 165 lenders that change on a daily basis. Compare this to a year ago and we had just 20,000 pieces of criteria from 100 lenders. Staying on top of this is simply impossible without a system to do the heavy lifting for you and why we think that criteria searching at the beginning of the advice process makes life so much easier for both brokers and borrowers.
So, a year on from our launch we’re happy that we’re playing our part in helping brokers help their clients and we’re really, really happy that a brokerage who attributed their increase in written business predominantly down to using Knowledge Bank dropped off a lovely big birthday cake!