AOBP Feature: Bridging The Technology Gap
Wayne Smethurst, executive committee member of the AOBP and founder of TFC Homeloans, argues that technology can, and will, support the expertise of specialist distributors.
Specialist distributors have long debated whether or not the hard work we do, our longstanding relationships with lenders and our expertise in placing complex cases is something that can be funnelled into a mortgage research tool that requires just a few clicks and a few minutes.
The answer is yes.
I know first-hand that the very best packaging firms have people with bags of experience and heaps of professionalism that some of our peers can never see being translated into a digital environment.
I understand why so many in our sector believe that what we achieve for our brokers and their clients very often depends on these rock solid working relationships, cultivated over many years, and on personal experience of placing difficult deals, negotiating with lenders and working alongside them to create bespoke products.
They are right about that.
In the case of bridging, we all know there are two types of lender. Some, such as Precise, offer a published product matrix and lending criteria, so clients either tick the boxes or they don’t. Others, like Amicus, don’t have an off-the-peg range of products, but individually underwrite cases and can create bespoke products for unusual or complex circumstances.
Both types of lender are an essential part of the sector and placing cases with the most appropriate for the client is what we do so well. Being able to cut a bespoke deal is part of the art of packaging and essential for those tricky cases we all come across. But, let’s be honest, these deals are not as transparent as the published products and can’t currently be researched and compared side by side with them.
However, I am confident that this sector will shortly be working within a digital framework, enabling product research across the spectrum of bridging deals. Yes, it’s a challenge, but it is possible. Just look at the success of comparison sites in taking complex financial products and presenting them side by side, so that consumers can compare them by overall cost, monthly cost or whatever feature means the most to them.
Change is coming
Those who say the future of bridging distribution is a digital one are right, but I would go one step further.
We shouldn’t actually be constrained by product type at all. After all, the FCA considers us to be one industry and we will soon be required to look at every appropriate option for clients. We need technology that enables us to do this.
The future is a mortgage research tool that allows us to compare all products side by side – mortgages, bridging loans, second charge loans, buy-to-let deals and commercial mortgages. This is the only way we can be sure we have found the most appropriate solution for the client, and prove to the regulator that we have done this wider search.
I don’t see this sort of technology and good old fashioned packaging as mutually exclusive. We need to reserve the relationship element of the job but technology doesn’t prohibit that. In fact it supports it.
You can only truly find the right product, and prove you have done proper research, if you can show you have compared all product types side by side. Technology can and will help us achieve this.