Mortgage brokers are being urged to step up their client engagement strategies as a major wave of fixed-rate 5-year mortgage deals come to an end.

London-based broker AS Financial reckons mortgage borrowers could be hit hard if steps aren’t taken to ensure clients continue to get the best outcome.

Speaking to Mortgage Soup, Marcel Istace, operations director at AS Financial, warned that thousands of borrowers will soon be coming to the end of their five-year fixed deals – and many may not yet be prepared for the potential financial impact.

He says: “We’re in constant communication with our clients but for many homeowners this is now the pinch point.

SUBSTANTIAL JUMP

“There’s a significant volume of 5-year fixes that were taken out during the low-rate environment of 2019 and 2020. Those rates are maturing now, and borrowers could face a substantial jump in monthly repayments if they move onto standard variable rates or less competitive remortgage deals.”

POST-PANDEMIC

Industry data suggests that a large number of borrowers secured fixed rates below 2% during the post-pandemic recovery period.

Istace adds: “Our own back book will mirror that of many other brokerages.

“We see this as a critical moment – not just for the financial well-being of clients, but for brokers to demonstrate value, retain relationships and strengthen their businesses.”

BETTER ACCESS

AS Financial is encouraging firms to audit their existing client base and implement targeted communication campaigns aimed at clients whose deals are nearing expiry.

Early engagement could help borrowers access better deals and avoid financial stress at a time when household budgets are already stretched.

Istace adds: “We want all of our brokers to be even more proactive: don’t wait for clients to call you – be the first to reach out.

“Whether it’s through email, phone, or face-to-face reviews, we want to make it clear that they and we are ready to help clients secure the most suitable deals available.”