Product and process improvements paying dividends with brokers
Written by Dave Castling, head of intermediaries at Atom bank
This time of year is often a period for reflection, to look back at how you have been operating, the decisions you have made and whether you have been successful.
That’s why the latest mortgage lender benchmark analysis from Smart Money People was so timely and notable for everyone at Atom bank.
The study is the industry’s largest independent broker research survey, so it provides a fantastic snapshot of what’s working and what isn’t. The research found that overall broker satisfaction with mortgage lenders has declined slightly. While the first half of the year saw broker satisfaction hit record levels, in the second half of 2023 it dropped by 0.5 percentage points to 82.9%.
In the grand scheme of things, this is positive, showing that despite the myriad of challenges faced by brokers and lenders alike over the past year, on the whole intermediaries are relatively content with how lenders operate. That’s testament to the industry as a whole working on building those relationships, and doing a better job of understanding what brokers need from the lending community.
In the face of those challenges, it’s even more satisfying therefore that Atom bank was named top bank by brokers. Given the general state of satisfaction with lenders, it’s incredibly rewarding to know that our bank has moved ahead of the pack in the eyes of advisers.
The importance of intermediaries
Intermediaries play an extraordinarily important role within the mortgage market. The vast majority of mortgage business goes through advisers – in 2022, brokers accounted for around 84% of mortgage distribution, according to the Intermediary Mortgage Lenders Association.
This is entirely understandable. Borrowers have always valued the expertise and guidance offered by brokers, helping the client determine the right sort of mortgage product to meet their circumstances.
This service has only become more sought after given the challenges of the last few years, and the way that mortgage rates and household budgets have changed. If borrowers want to find the best possible deal, then going through a broker is often the default move for many.
Understanding what brokers need
So if lenders want to work with and help intermediaries, it’s crucial to understand what they and their clients need most.
First and foremost we know that providing value is of paramount importance, delivering rates that are going to work for borrowers. I have no doubt that the fact that Atom bank has been quick to reduce our rates when we are able to has helped boost our standing in the eyes of brokers.
But there’s more to product design than simply offering competitive prices. It’s equally vital that lenders recognise where the gaps are in the market, the clients who are being underserved but who still require property finance.
A perfect example of this is the near prime sector. We know that the last few years have put an awful lot of people through the wringer financially, and while they may be in a stable position today, they may have missed the odd payment in the past.
Those black marks can prove the death knell for their borrowing chances with high street lenders who are so often focused on the most vanilla of applicants. Relying on credit scoring, as so many lenders do, when assessing applicants who may have had a small issue in the past, all too often leads to disappointment.
By contrast, Atom bank’s determination to support these borrowers and deliver more mortgage options for them has been strongly received by brokers. The reality is that this cohort of clients is only likely to increase in size in the years ahead, and will need nimble lenders, willing and able to judge them as individuals rather than a simple credit score.
The need for speed
Beyond product design and pricing, a slick process is crucial for brokers when determining which lender to place a case with. This has been an area we have focused on relentlessly at Atom bank over the last year, and it is clearly making a difference.
Speed is of the utmost importance in the mortgage market. Being able to judge and progress a case swiftly delivers tangible benefits to brokers and borrowers alike. For the
client, there is certainty – if they get a quick response, they don’t have the sleepless nights and stress over what their plan B may need to be.
The broker meanwhile avoids the hours spent chasing updates for a case, allowing them to either work with additional clients, undertake some professional development, or even take some time off.
By implementing technology sensibly, we have been able to provide brokers and their clients with a much speedier experience. That has meant that generally customers receive an offer in two days following the submission of an application, while nearly one in four get a response on the very same day. It still genuinely makes me smile when we get a call from a broker checking if the system is broken due to the fact they have received a mortgage offer minutes after hitting the submit button!
Topping the Smart Money People research is a great indication that we are getting things right at Atom bank, and that the changes we have made this year have been recognised by brokers. While we are of course delighted, this market moves quickly, and we know that standing still is not an option.
That’s why communication with brokers will continue to be at the forefront of how we operate, giving us a better indication of how we can support advisers and their clients, while further work will go into how we utilise technology to make everyone’s life easier.
By working closely together we can ensure that borrowers of all kinds enjoy a smoother, faster and fairer mortgage process. That’s something we are pretty excited about here at Atom bank.