The national media is encouraging people to review their mortgages as rate rises becomes a hot topic of conversation. This should help increase mortgage activity, which is at an all-time low.
Net lending was a meagre £8.5bn last year compared with the £110bn at the peak. If it was not for the few securitisations done last year, we would have certainly seen net lending in negative territory.
As soon as we have a rate rise, borrowers will realise that the Bank base rate has been artificially suppressed and seek to remortgage.
Brokers will have a fantastic opportunity and will increasingly beat bank mortgage advisers to the deal. Despite dual pricing and dual criteria favouring bank-based mortgage advisers, they are at a massive disadvantage to brokers.
Does the typical borrower really want to visit three or four high street banks to find which offers the best deal and, more importantly, which will actually lend to them?
That probably adds up to two days off work. Bank-based mortgage advisers should get a new label under the Mortgage Market Review of Totally and Utterly Tied, as they only advise on their employer’s mortgage products.
Compare that to the experience a borrower should have with a mortgage broker – one sales process and the opportunity to be advised on the products of multiple lenders.
Also, brokers can help borrowers who do not fit the criteria of high street lenders. I know which route I’d rather choose.