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True online binding decisions make for better service

From Jeff Knight

Reading about other lenders’ service problems shocks me. Given the technology that exists, intermediaries should not be subjected to lenders’ blowing up and giving poor levels of service. It’s not good for intermediaries or their clients. But if more lenders offered true online binding decisions this would not happen.

For example, over the past two years we have doubled our business without any disruption to service because of the efficiencies of our online system. And our product range clearly shows we have an appetite for more business.

My question is – why don’t more lenders use binding decisions? I say true binding decisions because intermediaries should be wary of online decisions that claim to be binding when they are not. Any lender that offers true binding decisions will grow their business without adversely affecting their service. GMAC-RFC and BM Solutions are good examples of this.

While I have a lot of respect for the team at Platform, it claims to provide binding decisions but clearly doesn’t. Otherwise it would not be experiencing the service problems it is. My guess is that cases are being underwritten again after the online decision has been made. If this is the case, the original decision can’t be binding and the online system won’t give it the efficiencies to take a lot of business and still provide good service.

Luckily our POSD system allows us high business levels and we can provide great service to intermediaries.

But I applaud Platform for at least trying to provide binding decisions. It will be good for intermediaries when more lenders actually do provide true binding decisions.

Marketing is no substitute for genuinely good deals

From Eddie Royce

Awesome, aggressive, money sale are all words I note were used to describe a popular lender’s latest headline rates to attract mainstream clients, or rather mainstream clients’ brokers.

Last week I also saw a columnist commenting on a survey of brokers and being surprised how many of them used only a small number of lenders for a large proportion of their business.

It’s not surprising that the lenders who throw money at marketing their headline rates get a fairly large slice of that week’s pie, irrespective of the overall cost of the scheme during its initial period.

For example, look at BM Solutions’ two-year 3.89% fixed rate, Yes the headline sounds great but a 1,499 fee on a mainstream? It’s not adverse or buy-to-let. If you take a typical 100,000 loan over the two years, the fee worsens the rate by 0.75% to 4.64%, and it doesn’t look so headline then. For those brokers regularly doing 250,000-plus loans it might be OK, so good luck.

But me, I’ll carry on using Trigold to calculate which deal offers my client the best value for the scheme period.

If this means a lot of my clients go to a few lenders like Nationwide and the service remains as good as it is, I will sleep well at night.


Sunday Times sponsor OPPLive 05

OPPLive 05, the first business to business exhibition for the overseas property industry, is pleased to announce the involvement of the Sunday Times. The newspaper is joining OPPLive as sponsors of the exhibition, alongside Travelex, which will take place on the 8th and 9th December 2005 at Alexandra Palace, London.David Le Lacheur, Sales Director of […]

Fund will focus on Olympic sites

Rugby Estates is planning to set up an Olympic property fund for land and properties in London’s East End. Over the next three years the property and asset management group plans to acquire up to 200m of industrial, commercial and residential assets throughout east London into Essex and south Suffolk for development in time for […]

B2L confounds the sceptics

Despite doom mongers predicting an imminent bust in buy-to-let, research reveals the sector is continuing to do well and confidence is booming. Mortgage Trust says increasing lender competition is helping to fuel the buy-to-let market. Its October buy-to-let intermediary forecast reveals that 50% of buy-to-let intermediaries cite the increased availability of more innovative and competitive […]

Barclays and Woolwich launch fixed rate deals

Barclays and Woolwich have launched a range of new mortgage deals with competitive rates.They offer a two-year fixed rate until January 31 2008 at 4.89%, and a five-year fixed rate until January 31 2011 at 4.99%.The products are available with no arrangement fees and no early repayment charges beyond the fixed period. There will also […]


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