A perfect chance to build a relationship

Is a borrower who wants to speak to you six months before the end of their mortgage tie-in period an opportunity or a waste of time?

Some brokers are frustrated because borrowers are looking for advice long before the end of their current term but others think it’s a a chance to start building a long-term relationship, as well as handle any immediate life assurance, general insurance and critical illness needs they have.

As industry consultant Alan Dring said in his column last month, rate tarts can be costly if we only focus on the case and not the client.

There seems to be some nervousness that wasn’t there last year, reflected in the flood of borrowers looking for advice every time the Monetary Policy Committee meets and how early they look for advice.

But there are still opportunities. Although the average remortgage borrower reckons their house is worth 11% less than last April – at £228,212 down from £255,346 – the amount they want to borrow has risen from £119,500 to £124,400, potentially a reflection of how hard it is to get credit now.

Despite lower house prices, most home owners have built up equity in their houses, so while the average deposit has dropped by 7% the average remortgage borrower coming through Leadbay is still only looking for 60% LTV.

A prime remortgage enquiry with 60% LTV can still be placed and even if the client is tied in for a couple of months, would you see it as a waste of time or a basis to start talking about their financial needs?