Packagers add value and won’t be bleeding to death any time soon

I feel compelled to reply to Chris Gardner\'s recent letter (Mortgage Strategy March 3). Gardner makes a number of erroneous points which I propose to demolish one by one.

• Diminishing pipelines? I’m not sure about Gardener’s business but we have done well in the past three moths. A number of our peers had the same story to tell the recent Packager Summit.
• Packagers are being edged out of the value? This misses the point. The last time I looked, no lender would allow you to use its application forms or retype valuations for other lenders, thus causing additional costs for customers. Plus, statistics indicate that the business lenders receive from packagers ids more likely to complete.
• Adverse proc fees? In most instances, packagers are valuable assets, offering sub-prime deals which brokers can’t source directly. And packagers are businesses, not charities.

Remember, packagers act on behalf of lenders and process cases from start to finish. This requires a lot of calls and means many forgotten items need chasing – at no cost to customers.

Incidentally, in most cases packagers won’t wait for lenders to pay their fees before paying brokers. In short, they add value.

• The sub-prime ‘pass the parcel’ effect? Surely, packagers can’t be blamed for customers getting into arrears with their sub-prime mortgages. If clients need adverse deals in the first place they obviously have difficulties and no other options. But if brokers know they can’t afford it, why recommend them to proceed?
• Brokers should review their competence and consider a change of career? I couldn’t possibly comment.

But I agree with one thing Gardner says – only the fit will survive the current crisis. Like many packagers, we’ve had our fair share of due diligence reporting in the past few weeks from the lenders and networks we work with and have come through unscathed

Unfortunately, the recent casualties in the packager market have left some introducers with a sour taste in their mouths. But following the Packager Summit, it’s clear the sector is in good shape and many lenders are making positive noises about working with us.

Packagers provide added value through on-site underwriters, generic application forms, controlled valuation processes, proc fees paid in 48 hours and state-of-the-art sourcing technology. I can’t see packagers bleeding to death any time soon.

Dale Jannels
Sales & marketing director
All Types of Mortgages
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