Swap rates rising have brought some rate increases and potentially delayed some of the anticipated reductions, but the overall picture of late has definitely been of an active market, with lenders still very keen to lend.

It’s been good to see continued product innovation as lenders test the water with different criteria and benefits – let’s hope for more of the same in the coming months. 

So, to business. Let’s focus on some of the changes we’ve seen in the last few weeks. 

Buy-to-let changes and launches 

Paragon has announced a refresh of its buy-to-let (BTL) products, with portfolio fixed rates now starting from 4.14% for single self-contained properties and 4.39% for houses in multiple occupation (HMOs) and multi-unit blocks (MUBs).

The 4.14% starting rate is for a two-year fixed up to 70% loan to value (LTV) for single self-contained properties with an EPC rating of A, B or C. The product fee is 5% and features a free valuation. 

Foundation Home Loans has launched new products in its Buy to Let by Foundation range. Its ‘pound-for-pound’ (£4£) remortgage products are assessed at 125% interest coverage ratio (ICR) regardless of tax status and are stressed at pay rate regardless of length of fixed period. Products are available in both F1 and F2 tiers and may appeal to higher-rate tax-paying landlords looking to remortgage on a two-year fixed with more favourable terms.

CHL Mortgages has added a new 3.5% fee option to its standard BTL and HMO/MUFB ranges. A standard two-year fixed product at 65% LTV is now available at 5.21% with a 3.5% fee, while the equivalent five-year fixed is priced at 5.55%. For HMO or multi-unit freehold block (MUFB), the two-year 65% LTV rate is 5.24% and the five-year version is 5.65%, both with a 3.5% fee. Fee options in the ranges are now 2%, 3.5%, 5% and 7%.

Santander has launched a range of BTL two-year tracker rates in its new business and product transfer ranges. The rates in the new business range include a 60% LTV two-year tracker at 5.6% with a £1,749 product fee and a 75% LTV two-year tracker rate at 5.84% with a £1,749 product fee.

Kensington Mortgages has released 75% LTV special rates that are available for both personal and limited company applications. A two-year fixed is available at 5.39% up to 75% LTV with a 3% fee and free valuation. The five-year fixed is priced at 4.89% and comes with a 5% fee and a free valuation. 

Adjustments to suit landlord needs 

West One Loans now has a new suite, W3, for landlords with previous credit issues. A wide variety of property types will be accepted, and impaired credit older than 12 months, unsecured arrears or missed payments on public utilities and communication suppliers will be ignored subject to a satisfactory explanation.

Available products include a five-year fixed at 7.04% with a 4.99% fee and a five-year fixed at 7.49% with a 2.5% fee, both available up to 65% LTV.

Virgin Money launched its Fix and Switch product in its portfolio landlord range, meaning there is now a Fix and Switch product across all its mortgages. This option gives the benefits of a five-year product, but only has early repayment charges (ERCs) for the first two years. As well as providing security and flexibility, as it’s a five-year product there are also affordability gains to be had. 

Mansfield Building Society has introduced proc fees for product transfers across its entire range, including Versatility, Versatility Plus, Credit Repair, Shared Ownership, Buy to Let and more. For cases placed by intermediaries, Mansfield will pay 0.2% as a procuration fee, with an enhanced fee to key club and network partners.

The Mortgage Works (TMW) has said that it will now accept limited company BTL purchase applications for properties currently inhabited by one of the company directors. TMW’s existing limited company product range will be available for these cases.

This move could make it easier for new landlords to enter the BTL market or for existing landlords to expand portfolios. 

YBS Commercial Mortgages is now offering simpler, short-form BTL valuations to estimate the market value of a property. The lender has aimed this change at landlords borrowing up to £3m on a maximum of four properties. Properties must be houses or flats to qualify. This change replaces full red book valuations and will help to save both time and money for portfolio landlords.

Zephyr Homeloans has reduced the stress rate calculation on its two-year fixed rates to assist clients with affordability. It is now the higher of payrate +2% or 5.5%. The lender previously included the reversion rate in its calculation. 

And, finally, United Trust Bank (UTB) has expanded its BTL and residential product ranges by accepting new-build properties.

Products are available up to a maximum 80% LTV and £1.5m, with rates starting from 4.84%. Purchases are allowed off-plan, subject to reinspection before completion, evidence of an appropriate new build warranty or certificate is required, and a maximum of 5% new-build incentives (including builder’s deposit) is allowed. 

See you next time, when we’ll hopefully see even more positive enhancements to help drive the market forward. 

This, we hope, is another step towards putting in place the types of measures we believe will not just improve the experience for consumers, but also for all stakeholders, whether conveyancers who we represent, or advisers and lenders reading this article.

We have, of course, many other stakeholders involved in that process – you might well argue this is one of the reasons why the process can be so frustrating, stressful and lengthy – and therefore we need solutions that are going to work right across those firms/individuals and are going to be engaged with thoroughly, as it is only through this industry-wide commitment that we will get the improvements we need. 

The call for written evidence has now passed and the Conveyancing Association (CA) has issued its response, as I’m sure have all manner of firms, trade bodies, organisations and the like. 

Advocating for more transparency 

We hope to be providing verbal evidence to the committee in the next stage of the inquiry, and needless to say, we will be strong advocates for the likes of upfront information to give greater certainty and transparency, the instruction of the seller’s conveyancer on day one of marketing, greater consumer education on the process, the regulation of property agents, and many more.

One area where we could also see significant strides right across the entire home buying and selling process, and that will – in our view – positively impact consumers, but also agents, legal professionals, search providers, advisers, lenders, surveyors, valuers, etc, is around greater take-up of digital processes. 

The CA, like many other organisations, is a member of the Digital Property Market Steering Group (DPMSG), and the protocol document, the Digital Property Information Protocol, is based on our own Digital Conveyancing Protocol, which seeks to set out the roles and responsibilities of stakeholders in their adoption of digital property information and solutions across all sectors.

A need for formalisation 

In a recent survey on the protocol, 75% of those stakeholders surveyed said they would find it useful, and there should be sector-specific requirements and responsibilities that can be shared with the client. This would detail the process for those professionals, how that process would work and links to property-specific information.

Four out of 10 respondents said there was nothing standing in the way of them using digital solutions, and clearly in key areas such as digital ID and digital signatures, for example, the benefits and protections this would provide and the duplication this would stop for all stakeholders should be evident.

The fact that this, along with other digital opportunities, will speed up the process will clearly be good news, particularly as we remain in a situation where completion times remain many months rather than weeks. 

The role of brokers in improving transaction process 

As mentioned, intermediaries would be one of the roles covered within the protocol.

I’m sure I don’t need to tell you of the benefits that might arise from one source of truth for checking ID or signatures, not forgetting getting rid of the constant to-ing and fro-ing and paperwork or checking, that can add many weeks to the process. 

Up until now, of course, there has been little in the way of mandation from government for these types of measures, but as many in the industry will know – and as highlighted above – left to our own devices, there is a good chance that a large number of stakeholders might not be as focused on taking up these solutions as others.

Effectively, a two-tier system – perhaps many more tiers depending on the level of engagement – would leave those firms who are working at the top end at the mercy of those who have no intention of taking on these solutions, which would improve the process. And, quite frankly, that can’t be allowed to happen. 

The positive news here comes with the inquiry at parliamentary committee level, the fact it is cross-party, and that it hopefully signals a further step forward in terms of getting government support for mandation. If everyone involved has to abide by these measures that will speed up the process, then everyone will benefit.

We can’t have a piecemeal approach, and it is positive to have the support of many stakeholders, who accept that one, joined-up solution relevant and taken on by all, and crucially with legislative backing, is the way to get the improvement we all want to see, and to be able to deliver to our clients.

However, the pressure on brokers to have a whole-market understanding of suitable mortgage products for people aged 50-90-plus is immense. Consumer Duty has put paid to the notion of equity release being the sole option for later life lending.

While equity release might be perfect for some homeowners, there are other, very welcome options on the table now.

Putting the client first 

Over the past few years, innovative specialists in later life lending have opened the market to a wider and deeper range of Consumer Duty-compliant products suitable for older age groups. These include standard capital and interest mortgages, interest-only mortgages, retirement interest-only (RIO) mortgages and, of course, lifetime mortgages – or equity release, as they are commonly known.

Following the July 2023 Consumer Duty obligations for better outcomes for retail consumers, the Financial Conduct Authority (FCA) published the Later Life Lending Review in September 2023. It found that the advice provided to many older borrowers did not meet the standards expected due to firms insufficiently evidencing the consumer’s individual circumstances, and the advice lacked discussion around alternatives to equity release mortgages.

Instead of lenders and brokers trying to fit customers into their products, we need to focus more on customer requirements, and select the most fitting product for the customer. It might at first appear intimidating, but Consumer Duty is an opportunity for brokers to offer more holistic advice for excellent customer outcomes – with a little help from lenders and technology.

Confusing quagmire of affordability 

For brokers who are either new to the industry or who are experienced purely in equity release, as I was until recently, it can be easy to get dragged into the confusing quagmire surrounding product options and the major issue of affordability that comes hand in hand with questions of age and retirement.

Now, more than ever, it is essential that brokers conduct an affordability assessment. This raises the question of what types of income and property a later life lender might consider, and whether adverse credit might stand in the way.

Types of income that later life lenders might welcome

This may not be as prohibitive as you might think. Some lenders consider factors, such as whether the homeowner is salaried well into retirement and later years, self-employed, or receives rental or lodger income.

Pensions, future pensions and spousal pensions transfers might all be welcome, as well as cash savings or investments.

Property types that later life lenders often consider

Lenders might also welcome a wide range of property types, such as being close to or above a commercial property, built of non-standard construction such as timber or steel frame, properties with close proximity to pylons or rail lines, or properties in a flood-risk area.

Adverse credit not necessarily a barrier

Some later life lenders may also accept adverse credit including missed payments caused by life events, debt management if arranged and maintained to a satisfactory level, unsecured missed payments, credit utilisation, mortgage arrears, county court judgments (CCJs) and defaults. 

Affordability calculator and counter-offer 

Since 2023, brokers have had access to a simple but clever product matching engine and counter-offer capability. It sifts through a whole range of 200-plus later life mortgage products, so brokers don’t have to. 

Based on criteria that the broker keys into the affordability calculator, the matching engine provides a full view of all later life options suitable for the client. If they fail to meet affordability requirements on the mortgage they originally wanted, the matching engine will counter-offer with a list of alternatives from across the range.

This takes away the hassle of manual searching and collating product data, while also providing a fully compliant record. More often than not, an intermediary will start the process with one product in mind and come away with a completely different product that not only is more suitable for their client, but may offer them a higher-value loan.

With our ageing demographic and £200bn in interest-only mortgages expiring over the next 10 years, the later life market is a great opportunity. It doesn’t have to be complicated. 

This has led to our business development managers (BDMs) frequently being asked questions such as “What’s the difference between an Airbnb and serviced accommodation?” or “What’s the difference between a holiday let and a short-term let?”

While these appear to be pretty straightforward questions on paper, from a lending perspective, we often have differing approaches in terms of risk, policy and criteria for such property types. So, you can fully understand why there may be some lingering confusion within the intermediary community.

Getting into the details of short-term and holiday lets 

Speaking more generally, short-term lets and holiday lets provide landlords with flexibility, allowing them to let out their properties on a stopgap basis, without the need for an Assured Shorthold Tenancy. These can be more ‘standard’ short-term lets where the property is occupied by travelling businesspeople, or those in need of a temporary home. 

Alternatively, holiday lets have become increasingly popular in the wake of the ‘staycation’ phenomenon, especially due to the continued growth of online platforms that are making it easier for property owners and managers to advertise their rooms or properties to potential guests both domestically and internationally.

With this in mind, it was interesting to see the Office for National Statistics (ONS) explore activity levels through three major online platforms, namely Airbnb, Booking.com and the Expedia Group. 

The report showed that, from July to September 2023, there were nearly 2.8 million stays in short-term lets booked through these platforms in the UK. This totalled nearly 28.9 million guest nights with an average of 313,879 guest nights each day.

In the UK, domestic visitors were suggested to have made up 63.6% of guest nights (18.4 million) compared with 36.4% by international visitors (10.5 million); Wales was the UK country with the highest proportion of domestic guest nights (85.3%). 

The local administrative units (LAUs) in the UK with the highest number of total guest nights in Q3 2023 were Cornwall (1,586,060), City of Edinburgh (1,157,180) and Westminster (871,900). The LAUs with the highest share of guest nights for each UK country were Cornwall (7.3% of England), City of Edinburgh (26.9% of Scotland), Gwynedd (19.1% of Wales), and Belfast (29.2% of Northern Ireland). 

In addition, the most popular LAUs for domestic guest nights were Cornwall (1,311,380), Gwynedd (365,750), and City of Edinburgh (345,000), whereas the most popular LAUs for international guest nights were City of Edinburgh (812,190), Westminster (757,350), and Kensington and Chelsea (389,720). 

Meeting the growing demand and interest

These represent some highly significant figures and are amplifying the emphasis on lenders to provide their intermediary partners with a wealth of options for landlords who may be looking towards a variety of property types, all with differing specifications and individual complexities.

Holiday lets and short-term lets form part of the core range from BTL by Foundation, but in addition to this, the growing demand for these properties from a wider range of borrower types has led us to launch a new suite of products from our new ‘Solutions by Foundation’ brand.

For example, we can now consider these short-term and holiday lets for UK landlords with multiple properties under one title – a scenario common when farm cottages have been converted or an individual property that has been divided into short-term lets or holiday let flats.

These specialist properties are an area of the private rented sector (PRS) that will continue to generate interest, questions and enquiries in the wake of sustained demand and the growth of online platforms. 

I’m sure there’s no business owner out there that hasn’t been burnt by this situation. The trouble is, we let the past predict the future. Just because it has happened before is not justification for you doing the lion’s share of the workload and business written.

Let’s address two issues that stop mortgage businesses from reaching their true potential. 

1) If I write the business myself, the company gets 100% of the income. 

Yes, that’s definitely a true statement. I’m not disagreeing with the blatantly obvious, but you’re swapping time for money. There’s no scalability, and you’ll certainly hit a ceiling at some point. If working flat-out seeing clients while a team of administrators hold things together is your business plan, then you’ll do very well.

I know people in this situation with three administrators that are writing £400,000 per year. They often look at least 10 years older than they are, but the model works. It has no saleable value, but banking at that level should mean you don’t need a lump-sum sale figure to see you into your retirement; instead, you can simply become a referrer, sending your clients to an alternative broker for 25% of the income. 

2) If I pass leads to a broker, they don’t convert like I do, and if they’re any good, they’ll leave and take their clients with them. 

Certainly a possibility but definitely not guaranteed, and unless you build some level of trust in your team, you’ll never achieve full potential. 

So, how do we start building a company where we maximise both brand and broker loyalty?

The two are well-linked, so are more easily achieved than you may expect. 

Providing brokers with high-quality, high-converting leads is certainly a great starting point, but they are never going to leave while they need leads. No, they’re most likely to leave once they have their own client bank. So, high-quality leads are the reason brokers join but not requiring future leads is a reason they will leave. That’s assuming you’ve created a great working environment. 

So, how do we build both brand and broker loyalty? 

The broker, in their natural habitat, is quite a lazy breed. The more they can get off their plate with someone else doing it for them, the happier they are.

Admin booking their appointments, happy days. Admin submitting their mortgage, heaven. Admin covering all case progression, perfect. This removal of all aspects of the work not requiring a qualified broker to complete is the perfect situation for two reasons. 

1) The broker has more time to meet with clients. 

2) The client’s relationship starts building with the company. 

Imagine this easily achievable scenario: the administrator calls the client to book the appointment. The administrator calls the client after any meetings with the broker to check customer satisfaction and the like. When the case is submitted, the administrator calls the customer and states that they are the first point of contact for any queries. 

This relationship continues during the case to completion and beyond. Any newsletters, updates or calls are all handled by the administrator. 

The adviser won’t complain, as they are now writing more and doing less admin. At least they won’t until they think about leaving, then they realise they don’t have such a solid relationship with ‘their’ clients, and they don’t fancy taking responsibility for the administration process they’re now out of touch with.

As a result, they realise they need to build on what they have as the alternative is now not quite as rosy. 

You soon reach a position where the client calls and asks for the administrator or their ‘client care rep’ rather than the adviser when making any sort of enquiry.

The adviser settles into the relatively easy life of being a mortgage seller rather than a part-time administrator and you, as the business owner, now have more time for yourself while earning more income as a company and with higher client satisfaction scores.

Utopia has been achieved; you now have brand and broker loyalty working in your favour. 

One area where we see a growing need for greater support is foreign nationals. The UK heavily relies on skilled workers to fill acute labour shortages, particularly in sectors like healthcare and IT. 

Last year, the government issued over 230,000 worker visas, up by 150% since before the pandemic.

Earlier this month, the government increased the minimum salary threshold from £26,200 to £38,700, in an attempt to curb the flow of migration to the UK. But the need for skilled foreign workers remains strong. Indeed, the Home Office projects that over half a million ‘in-country’ visas will be granted to foreign skilled workers by 2028/29. 

Foreign nationals seeking mortgages 

Criteria searches on broker platforms strongly suggest that there is a growing appetite for mortgage solutions to serve this segment of the market. They also suggest a significant unmet demand, given brokers frequently resort to these tools for complex cases they find challenging to resolve.

The fact is, too many foreign nationals currently face significant barriers to obtaining a mortgage and settling in the UK as their home away from home. Traditional lending criteria often exclude them from mortgages currently available, requiring minimum residency periods and income thresholds that may not align with their circumstances.

The base criteria that foreign nationals must currently meet include minimum UK residency requirements of one or two years and a minimum income threshold of £50,000. Added to this are capped loan-to-value (LTV) rates, often set at 75%, making it challenging for new arrivals to meet these demands. 

As a result, many new arrivals find themselves unable to achieve their homeownership ambitions, despite their aspirations to settle and integrate into British society. 

Innovative lending solutions 

We believe it is the duty of lenders, especially mutuals, to look for ways to break down these barriers to homeownership and look for more innovative ways to help more people secure a mortgage. That does not mean watering down affordability assessments or creating sub-prime products.

Far from it. But it does mean finding a way around restrictive criteria designed to protect lenders that are creating these segments of under-served borrowers. 

Through collaboration and innovation, we can build a more inclusive and accessible mortgage ecosystem that will allow more people to call the UK their home. 

At first, a mortgage network might roll out the red carpet and make various promises. So, naturally, brokers often aren’t thinking about what will happen if they decide to leave one day or if the relationship sours. 

However, it’s important for brokers to think not just about the present, but also about the worst-case scenario if they find they need to leave the network one day. They should also think carefully about what the network they are considering joining can do to help with a smooth transition. 

All too often, the conditions and restrictions placed on brokers if they want to leave a network can act as a barrier to them joining a new one, and problems only come to light when brokers look to move. 

A mortgage network’s terms and conditions 

This might be because brokers just skimmed over the small print or didn’t fully absorb what the conditions of the contract fully meant for their business – or what they would mean if there came a day when they wanted to move. 

Even if advisers were aware of the terms and conditions, when all seems well, brokers might like to think optimistically and believe they will never leave – much like a celebrity marriage without a prenup.

One area of frustration we see for brokers looking to move across to our network is what will happen to their commission payments once they make the switch. If an appointed representative (AR) resigns, it’s common for some networks to withhold brokers’ commission payments for a period of time – sometimes up to six months. While this might be to protect against clawbacks, it can make life very difficult for brokers.

How mortgage networks can assist brokers 

There are a number of things a new network can do to help, though.

The first thing a network can do is novate on-risk policies and indemnified commission across, so we take the liability. 

Where there are loaded premiums, however, brokers need to be particularly cautious about the terms of their initial contract. There may be some networks who agree to novate the liability, but if there are clawbacks, the broker repays even the network’s share. 

We can, however, guarantee the old network that, if anything does come off the books, we will make sure that we pay the network first. Sometimes that works out well, and they are happy with that, as they don’t have to chase brokers. 

The other thing we can do is help the broker with cash flow – this can often be the most important thing for an adviser when moving networks. Like a bank account, we can provide cash flow similar to an overdraft facility – which is very much a bespoke deal.

There are other considerations for brokers as well, such as what their contract states about their professional indemnity (PI) insurance and what happens, for example, if any future complaints are made against the adviser or whether there is a requirement for run-off cover. 

Whether it’s making the switch from directly authorised (DA) to AR or from one network to a rival, concerns over contract issues shouldn’t stop advisers moving networks if they are unhappy.

One size doesn’t fit all 

We see mortgage brokers switch networks for various reasons. They may be looking for a network that can help them expand into new products or financial planning, or they may need greater compliance support. Alternatively, they might be looking to grow their business by better utilising technology or by improving their marketing strategies. 

Or they might be thinking further ahead to when they retire and looking for a network that can help them with succession planning. 

What we often also see is brokers moving from larger networks to smaller ones for a more personal service and a higher level of support. They might be looking for a better sense of belonging or to have a network that they feel better understands their goals and aspirations.

As with all separation processes, it can be rocky or smooth, but a new network can help with this. If brokers do want to leave their network, they shouldn’t let fears over existing contracts stop them from breaking free. 

Click here to view the video of the Intermediary Mortgage Lenders Association’s (IMLA’s) Inclusivity and Diversity Group session on dyslexia, facilitated by Nationwide Building Society and The Mortgage Mum.

Dyslexia is primarily thought of as a learning difficulty affecting reading and writing, but it takes many different forms.

People with dyslexia may find it hard to match letters to sounds, to remember how to spell words, or they may even see letters moving around when they’re reading. Some may have trouble telling left from right. Remembering lots of instructions can be particularly hard. Some may need more time to remember the right word, and some may struggle to organise themselves. 

But seeing things differently can be very positive – people with dyslexia may be very good at identifying patterns and solving problems, imagining objects rotating in their head, telling stories, making people laugh, taking things apart, understanding how they work, understanding how to put them together again, inventing, making things, and seeing the bigger picture, for example. 

Many people feel uncomfortable identifying as dyslexic for fear they will be judged as less capable than others, when in reality many of the perceived ‘weaknesses’ dyslexics experience can be turned into strengths with the right support. And there are plenty of examples of famous dyslexics, from Bill Gates to Agatha Christie, Albert Einstein to Leonardo da Vinci, to name but a few, who are testament to what dyslexic people can achieve. 

Nicola Goldie, head of strategic partnerships and growth at Aldermore and co-deputy chair of the Intermediary Mortgage Lenders Association (IMLA), said: “Dyslexia is a condition affecting 10% of the population or 700 million people worldwide, yet it is not very well-understood. As mortgage lenders, there are simple yet effective changes we can make to help our dyslexic colleagues and broker partners function more effectively, and assist them in turning the challenges they face into strengths.” 

My story: Lydia Witney, senior business development adviser, Nationwide

“I was diagnosed with dyslexia at a very young age at school, because I was slower to pick things up than my classmates. 

“I chose not to disclose my dyslexia when I interviewed for a job in the mortgage collections and recoveries department at Nationwide in 2018. My previous job was not in financial services and did not involve numbers. I knew that, coming into Nationwide, I would need to deal with numbers, such as reading out large sums to customers over the phone. I am very dedicated and knew I could work on my numeracy skills to get it right. But I didn’t know how educated my interviewer might be around dyslexia and didn’t want to tell them in case they thought I couldn’t do the job. 

“During training, my manager picked up on some of the challenges I face, which she also experiences as a dyslexic person. She pulled me aside and told me about her challenges and her journey. Naturally, I then opened up about the problems I was having. Nationwide put in measures to help (see below), and introduced me to their Dyslexia + support group, which has more than 200 members. My confidence grew, and when I saw a job come up in the intermediary relations team, I applied for it. I was happy to disclose my dyslexia this time. In the interview, I laid it out clearly: here are my challenges, this is what I can do about them and here are the other things I can bring to the role. 

“I have since been promoted, am very happy in my job and feel I am doing well. I’m also in the process of completing a Level 2 apprenticeship in Leadership. If you’d told me five years ago I’d be back in education, I would have laughed. All the way through school I struggled learning new things, and shied away from doing A Levels and going to university. Nationwide helped me grow in confidence and now I’m trying to see my dyslexia as a strength and use it to my advantage. I have started talking about and learning about my dyslexia, and now I’m keen to educate others and help spread awareness.” 

Lydia’s challenges

• I spell erratically, so I rely on spellcheck, and ask people to ignore spelling mistakes in my emails. 
• I mix up my words without noticing. For example, I recently tried to arrange a meeting for next Wednesday but kept saying next Tuesday – in my head I was saying Wednesday, but kept saying Tuesday. 
• I get sensations of mental overload. If I am very busy and I’m in a noisy environment, I can feel overwhelmed and just switch off – I need to go away and come back with a fresh head. 
• I can forget whole conversations and important dates – wholly unintentionally. I can completely forget what I’ve been asked. 

Lydia’s coping mechanisms 

• In an interview, I will explain that I need to write the interviewer’s questions down, so I can refer back to them as I’m answering. 
• I am completely open with my manager, and will have a call with her if, for example, I receive a really important email. I will tell her what I have taken away from the email and check whether there is anything else I need to know. 
• I use lots of visual prompts and colour co-ordinate absolutely everything – my diary is so colourful it could make you feel sick. 

What can you do as an employer? 

1. Give clear and precise information (ideally bullet points, if not verbal) and check for understanding.
2. Create a working environment with no distractions or provide access to a quiet space – helps with mental overload issue. 
3. Provide suitable technology, such as online calendars and organisers, and digital recorders. 
4. Build planning time into each day, which lets the employee manage their time and feel in control of their workload. 
5. Provide audio or video versions of job ads as well as written ones. 
6. Keep interview questions brief. 
7. Provide practical hands-on training, rather than written instructions. 
8. Install dyslexia-friendly fonts on computers and set them as default in word processing software. 
9. Print information on coloured backgrounds. 
10. Allow dyslexic employees to use visual aids such as diagrams, drawings and flow charts. 

How can lenders support dyslexic intermediaries? The Mortgage Mum suggests:

1. Provide access to business development managers (BDMs) or LiveChat, as this is critical for talking through criteria that the broker may struggle with or misinterpret on the page. 
2. Encourage BDMs to be mindful that some brokers may be dyslexic but undiagnosed or reluctant to speak about their condition. 
3. Make criteria as easy to understand as possible and iron out ambiguities wherever possible. 
4. Present criteria in a clear format that is not too text-heavy – eliminate the waffle. 
5. Use bullet points rather than text-heavy chunky paragraphs. 

For more information, tools and guidance, visit the British Dyslexia Association website.

Which, of course, is not to say that they’re not as committed to the private rental sector (PRS) as they have always been – particularly professional players – but it does mean they may have needed to look at their investments in a different way, to reshape their portfolios in order to meet these challenges, to stay invested and keep making a profit. 

And that is not as easy as it might sound. As we have seen, a number of landlords – particularly those with one or two properties – have found their involvement in the PRS to be unsustainable.  

Even for those seasoned landlords, it may well have required moving into different areas of the sector – holiday lets, for example – or it will have required them disinvesting some properties in order to keep the portfolio profitable.  

What is interesting here – in terms of ongoing landlord approaches to their PRS investments – is how they are shifting to properties that are likely to be bringing them in higher yields. 

Increasing complexity not a shock 

Again, this is perhaps no surprise, and it has been a narrative for the sector for the past few years, but we have certainly seen a noticeable increase in this type of activity over the past 12 months.  

It should be instructive to advisers because they will certainly need to have stronger knowledge, relationships and interest in the more complex areas of buy to let as a result. 

Fundamentally, it’s what we should all have expected in not just a higher interest rate environment that produces higher mortgage costs, but also higher costs for landlords right across the board, whether that is maintenance costs, costs to up energy efficiency within homes, meeting licensing costs, perhaps they have been part of a rent control region, etc. 

This has all added up to a hit to profitability and, in order to stay invested, landlords are having to ‘cut their cloth accordingly’ and, where possible, either shift existing properties into, for example, houses in multiple occupation (HMOs) or multi-unit blocks (MUBs), or, when adding to portfolios, concentrate on those properties that can deliver higher yields. 

More interest in complex buy-to-let investments 

Our figures show a clear movement in the HMO direction. Looking at the loan origination detail by property type per quarter, we can see that for houses in particular, a bigger percentage of these are now being bought or refinanced as HMOs. 

Back in Q3 last year, the percentage of HMO houses was down at 14%, however in the first quarter of 2024, this had increased to 22%. And we can see a similar trend across all property types.  

In Q3 last year, the proportion of HMOs across all properties was just below 10%; in Q1 this year, it had risen to over 14%.  

It tells us that landlords want to maximise rental yield, and they understand that it is properties such as HMOs or MUBs that allow them to do this. Plus, of course, they are also reacting to the increased demand from tenants for private rented property at a time when supply has not been able to keep pace with that demand, or indeed with population growth, or the inability of people who might wish to buy to be able to do so, or indeed the increased demand for renting anyway. 

For advisers, it therefore makes perfect sense to ensure they are at the top of their game when it comes to the more complex areas of the specialist buy-to-let market.  

Our borrower type is split between two-thirds limited company/one-third private investor. So, it’s increasingly likely advisers will be dealing with limited company landlords with bigger portfolios – our average is 11 properties per landlord – who increasingly need finance for HMOs/MUBs, or who are looking to potentially redevelop existing properties, or looking to move into different sectors, or looking to diversify across the country, or all of the above. 

In that sense, it’s going to be increasingly important for advisers to be specialists in all of these areas as well, and to have strong working relationships with lenders who also specialise here.  

Buy to let continues to grow in complexity, and so do the needs of landlord clients – make sure you’re able to service those needs, and you’ll be in a strong position to grow your business alongside that of your clients.  

However, discussions regarding more specialist areas, such as bridging and commercial loans, can be noticeably absent. But why is this? 

It’s a bit of an elephant in the room – while some networks may operate an obligatory specialist referral panel, not all networks encourage brokers to actively advise in this area of the market themselves. 

There may be all kinds of reasons why they are reluctant to encourage brokers to explore areas of the market such as bridging and commercial. It could be due to perceived risk and a belief that this type of lending poses greater challenges to the broker and network, or it could be due to a financial arrangement a network operates with a referral partner. 

Branching out to specialist mortgages 

Unlike a residential mortgage, commercial loans, for example, are more about having good connections with business development managers (BDMs) rather than going through a sourcing system. While it’s true that commercial and bridging mortgages might require more work for the broker, such cases can also be more financially rewarding. 

I think it’s time the industry opened up the discussion and asked the question as to why some network models don’t help brokers more in this area. 

We no longer operate in a mortgage market where the clients contacting brokers are all vanilla cases. Instead of deterring a broker from handling a specialist case themselves, networks should be encouraging them to grow their business and expertise if there is an area they want to pursue. 

Bridging completions reached £1.69bn in Q4 2023, an 18.4% increase from Q3 2023, according to the Association of Short Term Lenders (ASTL). Meanwhile, a recent report from property lender Together; Opportunities and Outlook: The Future of Commercial Property, outlines how UK commercial property lending is set to grow from £90bn in 2023 to £118bn in 2028. That’s a 32% increase over the next five years – and it’s time for brokers to grab a slice of that pie. 

Empowering brokers 

While some brokers feel more confident handing over a client to a referral partner, others might wish to do it themselves but be lacking the support, which is a shame as bridging and commercial can make for some interesting cases. 

For networks, there are other ways; a 100% file checking process can help mitigate any risk the network might be worried about, as can offering members training and support to give them knowledge and empower them to advise on these areas themselves. 

If a broker needs to hand over the client to a referral partner, that not only means losing a level of control over their client, but also splitting the commission – as well as potentially having to pay another fee to some networks to access their specialist panel. 

As mentioned, the decision can also be a financial one. We operate on a flat monthly fee basis, with brokers keeping 100% of their proc fees and commissions. This isn’t standard across the industry, however, and if a network feels a broker can bring in more commission through less time-consuming residential mortgages, this may be the primary focus of the network. 

Of course, even with the option available, not all brokers want to branch out into more specialised areas and feel that their comfort zone is residential mortgages. 

Different ways of working

We often talk about how mortgage borrowers are not one-size-fits-all, and the same can be true of mortgage brokers. We launched our ‘mortgage desk’ towards the end of 2022, and this has offered a real insight into the different ways of working for brokers. 

As well as operating as a help desk, it also offers a referral service for brokers if they don’t have time or don’t wish to advise on the mortgage themselves. In some instances, the desk can also work in the opposite way, so a broker might want to focus on a larger more complex case and outsource the more regular residential cases to the mortgage desk.

Already this year, we have had 21 completions through our single adviser on the desk. These are from all areas of the mortgage market – it might be commercial, or a borrower with credit problems; the mortgage desk can help advise brokers on how best to place the case or simply refer it on and split the commission – which means the broker doesn’t need to turn potential clients away. 

It’s all about choice, and I think it’s time we opened up the discussion as an industry as to why more isn’t being done to equip and encourage brokers into more specialist areas. Networks should be there to encourage their members to grow and thrive.

Brokers need to have faith in themselves, but so too does their network.