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Cover story: Service mark

Mortgage Strategy’s latest quarterly survey shows that some lenders have taken their eye off the ball this summer, with service often proving their undoing


The summer months are often a quieter time for the mortgage market but have lenders been taking things a bit too easy this year? The past quarter has seen the undoing of a number of lenders whose service appears to have fizzled out.

So which lenders does our panel think have succumbed to the heat and which ones have played it cool and remained on track?

As with our previous quarterly surveys, the scores relate purely to residential mortgage business, with panel members asked to assign each lender a score from 0 to 10 in each category.

Each judge’s scores reflect not only their own experience but that of their colleagues and other advisers in their firm or network.

Percentage scores were calculated for each lender per category, accounting for any cases where no score was assigned due to a panel member not having dealt with a lender. The average percentage score across the categories was then calculated for each lender, enabling an overall ranking and comparison to be made.

You can find a summary of the results of Mortgage Strategy’s latest quarterly survey in the table below. Our panel has also highlighted a Lender of the Quarter that does not sit within the top-10 largest lenders by volume but has stood out in terms of its overall offering in the past quarter.


Halifax has stormed to victory this quarter with an overall score of 81.1 per cent. Its confidence score of 88 per cent helped propel it from second place last quarter to first place this quarter.

If I Were You chief executive Rob Clifford says the way Halifax initially processes applications continues to be both successful and unique.

“Its approach saves time and complications with admin difficulties that can stall many cases,” he says.

John Charcol senior technical manager Ray Boulger describes Halifax’s online system as “quick and easy” and says the lender offers “good communication and flexible underwriting”.

Chadney Bulgin mortgage partner Jonathan Clark says Halifax has managed to improve its rates while maintaining overall service levels. But he adds: “We are beginning to notice some very un-Halifax-like delays in processing, particularly on larger loans.” Trinity Financial product and communications manager Aaron Strutt agrees that the lender’s service has taken a knock recently.

“Our brokers like the way they can speak directly to an underwriter but the  service has been slower than normal,” he says.

Personal Touch Financial Services mortgage proposition manager Victoria Jefferies says: “Long waiting times for the helpdesk are causing frustration.”

Alexander Hall technical director Richard Merrett thinks Halifax’s workload could be behind the delays.

“The launch of its Service Excellence proposition has been superb, with cases under £300,000 underwritten instantly,” he says. “Unfortunately, the Premier department has suffered from the volume of business and service has slipped marginally below its usual impeccable standards.”

However, he adds: “The overall level of confidence in using Halifax has prevented this from becoming a significant problem.”

RBS (NatWest Intermediary Solutions)

NatWest Intermediary Solutions has increased its standing by two places this quarter, climbing to second place. It gained its highest scores for BDM support and confidence.

Perception Finance managing director David Sheppard has praise for the lender.

“If only more lenders were like NatWest,” he says. “It is easy to work with, has an excellent BDM and consistently offers mortgages quickly and with little drama.”

Riach Financial Advisers mortgage broker Bob Riach agrees. “My NatWest BDM is very helpful, tries to resolve issues quickly and is always honest with her answers,” he says. “She always returns telephone messages.”

The move to accept scanned copies of supporting documentation has also been welcomed. “It means brokers no longer need to fax these documents,” says Riach. “This a great improvement.”

He adds: “Like several other mortgage lenders, NatWest needs to move away from having to certify documents before sending them. This can be very time-consuming, especially if there are lots of documents to certify.”

London & Country associate director of communications David Hollingworth believes NatWest has had a great quarter with some extremely strong products, such as its table-topping five-year fix.

“As well as this,” he says, “it can be easier to work with than some other lenders. You get the impression that it is committed to building its intermediary distribution.”

However, Merrett says NatWest’s service has fallen behind that of its peers recently, although it remains very popular with advisers thanks to its straightforward criteria.

Clark notes that NatWest has sharpened its rates and now offers some of the best available. “Its ‘no dual-pricing’ policy will also find favour with brokers,” he adds. However, according to one panel member: “Service issues remain at the forefront for NatWest. There are very long hold times to get through to agents, only to be given incorrect information and no explanation for delays with cases.

“Currently, we have no assigned BDM and this has created further issues with no one taking responsibility for this role in the interim period. Although the live chat remains a useful tool pre-application, once submitted we have no assistance when cases need to be escalated or decisions challenged.”

Nationwide for Intermediaries

Nationwide has proved popular with the panel this quarter, moving up three places from sixth to third. Its highest scores were for service and BDM support, with overall proposition receiving its lowest score.

Merrett says the lender’s acceptance of 100 per cent of a consistent regular bonus gives it an edge.

“It would be great if it had an interest-only proposition to sit alongside this,” he adds.

Hollingworth says Nationwide’s service has been a strong point this quarter, coupled with a “solid, dependable policy approach” .

He adds: “Product pricing was fair rather than creating much of a wow factor. However, it sits consistently on the shoulder of some of the leading rates.”

Sheppard thinks Nationwide has “drifted in and out” with its product offerings over the quarter. “I hope it will come back soon to give us and our clients greater choice,” he says.

Another panel member comments: “Its service is competent but can come unstuck with pedantic underwriting requests. Rates are always fairly attractive, especially at the higher end of LTV.”

TenetLime managing director Gemma Harle says Nationwide’s affordability caps are low compared with those of other lenders but it has “fairly decent processing once the application is submitted”.

Santander for Intermediaries

Santander has lost its edge this quarter, falling from top spot to fourth position. Its service is the key area that has let it down, scoring 73 per cent compared with 84 per cent last time.

Sheppard says: “The service from Santander is a concern of late. Most of our cases have eventually gone to offer but it has taken some determination on our part to make that happen.

“I would like to see a few extra changes to its online application system so that the underwriting requirements are easier to provide. There is still doubt whenever I am keying a case as to where certain disclosures should be keyed to avoid double-counting of any outgoings.”

Clifford calls Santander’s BDM “very helpful” but says “effectiveness is hampered by limited influence”.

Strutt notes the lender is trying to offer more £1m-plus mortgages and it has a specialist large-loan team that is keen to help.

“Its rates were cheaper than Woolwich’s for a short period and the arrangement fees were more competitively priced,” he says.

However, one panel member comments: “Continually near the top of sourcing lists for rates but extended timescales for assessment, underwriting errors, internal confusion and contradictions over criteria have seen Santander slip to the bottom of the table in these areas.”

Harle says the lender offers “great service” and lending criteria but has “inconsistent BDM availability”.

Virgin Money

Virgin has maintained fifth position with an overall score of 76.1 per cent. It scored highly for service and products.

Competitive pricing across the market this summer has made it difficult to stand out from the crowd, according to Hollingworth. But Virgin Money “continues to demonstrate its commitment to brokers with intermediary exclusives as well as developing a strong range of attractive rates at 90 per cent LTV and enhanced cashbacks for first-time buyers”, he says. However, Riach says: “Virgin Money service is good, with friendly and knowledgeable staff, but the criteria are strict and not as flexible as at some other lenders.

“It asks a lot of questions just to obtain a decision in principle, but it tends to answer the phone lines quickly and doesn’t keep you on hold for long.”

Jefferies says Virgin’s systems are “not easy” while, according to Clark, its last-minute underwriting policy can prove “frustrating and will always trip up some brokers”.

But Clifford says confidence in using Virgin is high, aided by a BDM who is helpful and effective.

“He holds levels of authority that can influence cases and is frequently visible in the office. The process centre staff are also informed and friendly. The removal of the final full underwrite would be advantageous for us as brokers,” adds Clifford.

Coventry Intermediaries

Coventry has moved from seventh position to sixth this quarter with an overall score of 74.6 per cent. It scored highly for service and confidence but gained its lowest score for BDM support.

However, panel members differed greatly in their BDM scores for Coventry, perhaps suggesting regional differences.

Sheppard says he increased his score this quarter because the lender had made a more pro-active attempt to offer BDM support both locally and over the phone.

“We feel far more assured when using it now, knowing that there is someone who understands the local market and who can assist on the more complex situations,” he says.

Clifford was impressed by the lender’s service. He says: “Confidence in using Coventry is high and this stems from the highly praised BDM. All interactions with her are positive and faith in her abilities to push cases through is high.”

Merrett too rates the lender’s service as “superb”.

“Coventry’s process of instructing a free basic valuation immediately upon receipt of application is great for both customers and advisers in such a busy market,” he says.

Hollingworth says Coventry kicked off the quarter with a competitive portfolio of products.

“It briefly went toe to toe with NatWest on five-year fixed rates and it maintained very good products in some of the LTV bands further up the scale,” he says.

“The free valuation, which is standard on purchases as well as part of its remortgage package, is a welcome feature.”

Skipton Building Society

Skipton has seen a sharp drop this quarter, falling from third to seventh in the poll. Its lowest scores were for service and BDM support.

In May, it became the latest lender to reduce its maximum loan-to-income ratio to 4.75 times income – down from five times. It has also recently increased its maximum LTV on new-build flats to 90 per cent.

Sheppard says: “Skipton has not shone on rates as much as it did previously, which is a surprise. We want to support the smaller lenders more but obviously this can be tougher if they are not as competitive at any given moment.”

Despite Skipton’s fall of four places in the table, most panel members were positive about the lender. Merrett says it has significantly developed its intermediary support team and made more notable criteria changes, particularly for new-build.

He says: “It is demonstrating a real understanding of the intermediary market and what its partner firms need.”

Hollingworth says Skipton is “very good at looking through the product range to pull together attractive rates throughout the LTV spectrum”.

Barclays (Woolwich)

Barclays has held steady in eighth place this quarter, gaining its best scores for products and overall proposition.

In June, it loosened its interest-only criteria to allow borrowers to take up to 75 per cent LTV loans, with 50 per cent LTV on an interest-only basis. Previously, where sale of property was used as the repayment vehicle, borrowers could have a loan to a maximum of 50 per cent LTV.

Also in June, Barclays relaxed its LTI criteria by reducing the threshold at which its maximum LTI of five times income applied.

Strutt says: “Woolwich’s rates are competitively priced and it’s great news that it is offering five times salary mortgages again. Its interest-only policy has also been improved to attract more borrowers and provide the other lenders with a bit more competition.”

Hollingworth says Barclays has had some “stonking products on offer” recently, including a five-year fix below 2 per cent and a market-leading 10-year deal.

“With service really stepping up to the mark and a good retention offering, its overall proposition is very strong,” he says.

Harle thinks the lender offers “excellent BDM support” but it “seems to require a larger amount of supporting documentation than other lenders”.

Meanwhile, Sheppard says: “Woolwich is a steady player without doing anything amazing, although it is good to see that it has changed its interest-only criteria to give Santander some competition.

“We still need better local support but I am not convinced this will be forthcoming.”

Clark says hardly a day passes without an improvement in criteria by Barclays. “It is clearly trying very hard to win back brokers’ confidence. Even its online proposition is getting some attention,” he says. Jefferies, however, describes the lender’s service this quarter as “poor”.

Clydesdale Bank

Clydesdale remains in ninth position this quarter, propped up by its BDM score.

Merrett says: “Clydesdale has made some improvements to products, enabling it to compete more. It also has a good understanding of the importance of intermediary relationship management.”

However, one panel member disagrees: “Uniform opinion about Clydesdale across the board is that it is ineffectual and stagnant in all areas.

“It has recently withdrawn some rates to reduce business so we are unlikely to place business with it currently. Confidence in Clydesdale is low and applications will be placed only as a matter of last resort.”

Harle is slightly less scathing, describing Clydesdale as an “old-school lender”.

She adds: “Communication through the application process can be poor and it often takes a lot of chasing on the telephone.”

Clark, meanwhile, is more generous: “You need to know Clydesdale’s often quirky criteria inside out in order to submit business to it confidently.

“But it continues to do things other lenders won’t and offers excellent BDM support.”

YBS (Accord Mortgages)

Accord has failed to up its game and is still mired at the bottom of the table, despite an impressive score of 78 per cent for its products – one of the highest product scores of all the lenders. A service score of 58 per cent has let it down.

Sheppard says: “It is a shame to see such a poor quarter from Accord service-wise. We are finding that cases offered are repeatedly picked up for further scrutiny, which can lead to added delays and stress for the client.

“In trying to make the process of a mortgage easier, it has somehow succeeded in going the other way. It needs to work hard to turn that around and return to the higher levels of confidence that we have had before.”

Harle says Accord offers good field support but “is let down by a bad credit score system and poor telephone back-up”.

Merrett confirms that the lender’s products have remained very good.

He says: “Significant service enhancements towards the end of the quarter should lead to a very good second half of the year.”

Hollingworth welcomes the lender’s move to broaden its access to telephone teams to ensure easier contact points.

“This shows it is taking some practical steps to improve service,” he says.“It is always very capable of pricing good products but does not always back it with a reliable service, which can sometimes make for an uphill battle.

“I’d expect to see changes there and the large-loans team is an example of where it can gain the confidence of brokers.”

One panel member comments: “We have had mixed reviews for Accord for all aspects of the business. One explanation may be the inconsistency with which applications are processed, which in turn appears deeply reliant on individual staff. Rates are consistently top sourcing but the BDMs are hard to get hold of, which is obviously detrimental in urgent cases. The underwriting process can be convoluted and pedantic, which holds up the progress of applications.”

Making inroads

Service has been the undoing of many lenders this quarter. There seems to have been a concerted effort to improve products but few have matched this with the necessary service or systems to back it up. While several panel members say lenders are making inroads in improving their systems and criteria, these steps have been too small to date to make a significant impact on our survey.

The second half of the year is getting into its stride and an interest rate rise looks increasingly imminent. It will be interesting to see, in our next quarterly poll, which lenders have upped their game to meet their end-of-year targets.

Lender of the quarter

Once again there is a tie for Lender of the Quarter with our panel nominating both Metro Bank and TSB Intermediary. Boulger says Metro Bank offers a “very good service, sensible lending criteria and excellent BDM support”. Meanwhile, Hollingworth says of TSB: “Its pricing is really good and it has only just withdrawn its five-year fix at 2.09 per cent for larger loans above £200,000. It is outperforming some of the lenders in the table.”




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The value of an investment and any income from it can fall as well as rise and you may not get back the amount originally invested. Forecasts and past performance are not a guide to future performance. Some information and statistical data herein has been obtained from sources we believe to be reliable but in no way are warranted by us as to their accuracy or completeness. These are Neptune’s views and as such this document is deemed to be impartial research. We do not undertake to advise you of any change to our views.


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