'Perfect' time for brokers to stand out as self-employed borrowers face rising costs and delays




In a recent webinar on the impact Covid-19 has had on the UK's self-employed market, Matt McCullough, national sales manager of intermediary mortgage distribution at Aldermore (featured second in the video, above) said that it was the "perfect time" for the intermediary market to stand out.

The comment followed a question with regard to whether the current situation has made delays to the underwriting stages for self-employed borrowers for residential, BTL and commercial mortgages.

Alistair Hargreaves, finance consultant at Arc & Co (featured first in the video, above), claimed that underwriters’ time has now increased four-fold when assessing deals, in addition to more information needed from borrowers.

“…Instead of providing five documents, suddenly [the client is] providing 15 documents,” he explained.

“The accountant [is also] having to provide a more nuanced reference, plus projection, [and] a whole range of other stuff and, suddenly, the packaging, from our point of view, goes from being reasonably slim to much greater. 

“So, we’re all effectively doing more work to get to the same situation as before.”

He believes it is important to manage the client’s expectations around the extra potential costs involved, as well as the additional time needed to get deals moving forward.

“…They can’t be expecting that we are going to get an offer out within three or four weeks, because that isn’t a world we are going to be in now for a while.”

As a result, Matt believes that “this is now a perfect time … for the intermediary market to stand out.”

“One of the things that we are really campaigning [for] at the moment is [for brokers to get] closer to [their] full-time, self-employed landlords because, as an intermediary, what you could see [is] potentially becoming an indirect business partner of a landlord."

He referenced landlords who may be overly exposed to areas such as student lets and multi-sharing properties.

He explained that if universities merge or become more digital, it could put a “huge strain” on the BTL market.

“At that point, it’s an intermediary’s job to … look at the future and think, ‘How can we adapt and potentially diversify your portfolio a bit, [to make] it more risk-proof in future — not just for yourself, but also to get funding from lenders as well?’”

Part one of the webinar — which was chaired by B&C editor, Beth Fisher, and included Stephen Barringer, head of mortgages at Market Harborough Building Society, and Jonathan Bregman, managing director at JD Bregman & Co —  can be viewed in full, below.

The next part will be published next week.

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