Almost half (49%) of those who purchased a property with a mortgage after going direct to their mortgage lender said they did so as they felt more secure dealing directly, research from MCI Club has found.
MCI’s parent company DPR Group surveyed over 1,500 consumers as part of its Mortgage Insights 20/21 and found that 56% of those who had made a recent mortgage purchase went direct to the lender.
But for those that did engage a mortgage broker, 52% did so for the reassurance that the broker’s advice would help them to choose the correct product, 46% to access more lenders, and 38% for better rates. The results reveal that all in the intermediary market have more to do to convey the value that mortgage brokers add to the process of getting a mortgage.
When asked 21% of brokers stated that borrowers come to them because they recognise the value of advice, and 31% felt that by offering ease of support and service.
Looking ahead five years, 43% of consumers felt that between 11% and 40% would continue to go direct to lender. 31% of brokers, on the other hand, believed that 90% of all new mortgage business would come from advice via brokers.
In the reason for their responses, brokers focused on lender branch closures, consumers growing preference for shopping around, the level of service brokers offered, and improved technology.
Melanie Spencer, head of the MCI mortgage club, said: “There continues to be a disconnect between consumer perception and how brokers believe they are positioning themselves in the market.
“We all know the true value of advice and the reassurance this provides consumers in navigating the congested landscape of solutions that will not only meet the needs of each client today, but also into their futures. However, it is clear that we need to communicate this both more widely and more clearly.
“It is heartening that brokers understand the subtle challenges of quality of service and accessibility in the next five years. There is a solution to help counter the D2C conundrum however.
“It will be those who look to simplify the advice process and embrace technology who will lead the charge. It is more essential than ever for brokers to support their service levels through their back-office systems. This will enable them to reach out to both new and existing consumers through their consumer-facing technology.”