HOW DO YOU KEEP TRACK OF THE FREQUENT CHANGES IN BTL PRODUCTS FROM LENDERS?

Shazad Ahmed, director at Elan Property Finance

Nowadays, it is no longer enough to rely on email updates from lenders. The first and last thing I do each day is check for any rate, product and criteria change that will affect existing deals in the pipeline, as well as cases that are due to be submitted. Sourcing systems will, of course, provide up-to-date information about interest rates and tools, such as Knowledge Bank, can help with criteria. However, I’ve found that even these are not always up to the minute right now. Industry websites are helpful, including LinkedIn bulletins about these revisions. Communication is key right now. When there are criteria and product changes, we are informing clients about these via our internal newsletter. What doesn’t help are some of the silent criteria changes that come up at point of submission or, worse still, underwriting.

Meir Peer, director at Redi Finance

Being that my background has mainly been focused on bridging, it goes without saying that the recent volatility in the BTL market all came to me as a bit of a culture shock. This recent period where the market was changing on a daily basis was personally one of the most confusing and frustrating times in my specialist lending career. The changes were sometimes hard to keep up with. Other than mail shots—whether direct from lenders or news publications that cover the industry—I tried to keep myself up to date by constantly speaking to other brokers I am close to. For me, this is still a great way to stay informed with different products and to find out what is working well for others in my shoes.

Matthew Rowne, director at The Buy to Let Broker

Our specialist advisory team have access to all up-to-date sourcing software, in addition to various mortgage criteria search systems—should they need them. We very much expect all of our advisers to have a complete knowledge of all lenders in respect of criteria, policy and even subtleties, such as individual sensitivities and appetite within different areas of lending. We also work intimately with nearly all specialist finance providers and, as such, lenders’ senior management, underwriters and regional representatives will often work from within our offices offering on-the-spot sign-off in many cases— sometimes offering clients additional layers of certainty.

Kim McGinley, director at VIBE Specialist Finance

It’s certainly been difficult in recent months with so many daily/weekly lender product changes. It all comes down to the correct communication from the finance providers as, without this, it can get extremely complicated. We now have a process for keeping the team updated and have regular meetings to discuss them. Sourcing systems— in instances where they can be used—certainly help. However, even these could not keep up to date with the rapid changes in the market towards the end of 2022, so it was back to the good old days of manual sourcing for a while. As many lenders’ turnaround times were severely impacted for a while, it hasn’t just been about sourcing the most competitive finance option product-wise, but about who can actually get the case across the line in a timely manner. It’s imperative that us brokers can see clearly on lenders’ websites what their current turnaround times are to ensure we are providing the most suitable finance product to a client.

Meir Peer, director at Redi Finance

When a change in the market has impacted completion of a live case, the panic in some of the clients’ voices was a really upsetting thing to witness. I have had instances when I was lucky enough to have time to place the deal elsewhere but, for some cases, when time was short, we would look at a bridging loan as an option. In the worst case scenario, the deal just no longer fitted and the clients had to walk away. At that point, plan B is off the table. It is a tricky situation because some of the clientele like to focus the blame solely on the broker, but more experienced investors understood the pressure someone like myself was under and never pointed the blame in my direction.

Matthew Rowne, director at The Buy to Let Broker

There is universal acceptance that the lack of certainty, consistent variation in lender policy/criteria and, to some degree, underwriting guidelines can make an adviser’s role more challenging, more complex and, as a direct result, considerably more time-intensive. However, great challenges usually present in tandem with even greater opportunities—in this case for landlords and for specialist brokerages and lenders within the sector. The tough environment has resulted in more solutions for landlords and greater options, which indirectly should have a positive wider impact on the PRS and, most importantly, tenants. Such complexity has further polarised the market, and it is of greater importance that the professional landlord and their wider advisory team—including a specialist brokerage and tax adviser—work in partnership for holistic solutions.

Kim McGinley, director at VIBE Specialist Finance

Initially, deals were negatively impacted, with some lenders giving unrealistic deadlines before increasing rates which, at times, felt like an unfair partnership. Our team has a process when new rates are announced to make sure clients are being moved over to them where appropriate. With any case, our job as a specialist broker is to ensure we can secure another rate as quickly as possible for customers. The issue here is that the mortgage process is so much longer now compared to 18-24 months ago, and starting the process again is not always easy. All we can do is keep our clients updated as much as possible and keep expanding our knowledge of the market and staying on top of changes so, if a deal falls through, we can act on it quickly.

Toby Breeden, new business director at Crystal Specialist Finance

Obviously, deals were impacted when products were withdrawn with little or no notice following the minibudget in September last year. This involved a great deal of reprocessing applications, but we adapted over time as product changes became more regular and we were able to anticipate them. Importantly, we also managed the expectations of all parties, constantly updating them and making them aware of key dates, which helped to reduce the number of impacted deals.