It’s funny how we often use the words interesting or challenging when what we actually mean is downright difficult. Certainly there can be no doubt that we are going through a difficult period and it is not just one sector of the mortgage market that is under pressure. At such a time it is easy to become introverted, when a wider perspective and more collaborative approach would service us all better.
A lot of the focus over recent weeks and months has been on the supply side of the equation. Banks are unwilling to lend as freely to each other as they were in the past and where they do the capital comes at a premium.
Investors are uninterested in mortgage backed assets making life difficult for those securitising the mortgages they generate and there is real uncertainty over how long this financial gridlock will last.
Given these issues mortgage lenders are struggling to manage the levels of capital they have at their disposal and rather than lend it all in the immediate future they are desperately trying to keep some of their powder dry and create a steady but sustainable level of sales flowing through their pipeline.
This is a very difficult balancing act and with online applications and fast changing products coming in and out of the market, it is very easy for lenders to find themselves facing either a flood or a famine.
While lenders juggle these commercial headaches on one side of the equation, brokers are left trying to work out which ones will manage to keep all of their balls in the air long enough for their clients to secure the deal they are applying for.
This is becoming a nigh on impossible task and there are countless stories of borrowers failing to get a product before the shutter comes down and having to go through the whole advice and application process two, three and even four times.
Not only is this time consuming, but it also means brokers are doing significantly more work to place a mortgage while trying to manage client expectations.
Brokers are also under an increasing amount of pressure to work faster and more accurately to make sure they get their client the mortgage they want before it is pulled.
Keeping abreast of a market that is moving as quickly as the UK mortgage sector at the moment is incredibly difficult, especially for brokers who are out doing client interviews and do not have the time to stay glued to their email or sourcing systems. Despite the issues that lenders are facing on the supply side, we should not forget the problems this creates for intermediaries on the demand side and the agility they must show to deal with the shifting sands under their feet.
Unfortunately there is no easy answer, but industry collaboration and communication must be a priority. Each and every part of the chain must look to give as much advance notice of its next move to commercial partners. This approach should give everyone a little bit of breathing space in which to work and make things easier for borrowers, brokers and lenders alike.