Building societies should use technology to improve service while retaining the flexibility that helps brokers place complex cases, according to the latest Lenders Live panel.

The discussion also examined how brokers explain their fees and what rising remortgage search activity means for advisers and their clients.

Hosted by Shane Chawatama (main picture, inset), sales director at Knowledge Bank, episode 194 featured Alice Baggott of The Mortgage Lender and Bluestone Mortgages, Beth Foryzewski of Landbay, Matthew Arena of Brilliant Group and Naima Mirza of Capital B Property Finance.

FLEXIBILITY AND TECHNOLOGY

The panel discussed Mortgage Strategy’s article, “How tech modernisation will futureproof building societies”, exploring how digital investment could support the personal service and individual lending decisions associated with mutual lenders.

Foryzewski welcomed technology that improves the broker and customer journey, drawing on her experience of submitting cases through both cumbersome and more intuitive lender systems. However, she also highlighted the risk of technology fatigue when businesses introduce multiple tools without making their purpose clear to the people using them.

For building societies, the opportunity was to build on established relationships and improve the experience of working with them.

The starting point should be the outcome a lender wants to achieve, rather than adopting a system simply because competitors have it.

Arena argued that culture was just as important as technology. Some societies could respond quickly and flexibly, while others were held back by slow committee processes.

Remaining relevant required a combination of personal service, responsive decisions and a clear understanding of the intermediary community.

Baggott, who began her mortgage career at a building society, described the value of discussing a case with senior decision-makers and considering whether the overall circumstances made sense.

That approach could create a route for a customer whose profile did not fit neatly into a standard application process.

She supported technology that speeds up the work around those decisions, while cautioning against losing the individual assessment that makes this lending valuable.

Mirza echoed that view, stressing the importance of being able to call someone, explain a case and discuss what might be possible.

Nearly nine in ten respondents to the audience poll selected flexible lending criteria as building societies’ biggest strength compared with larger banks. While an informal snapshot, it reinforced the panel’s focus on preserving human judgement as systems improve.

MAKING ADVICE VISIBLE

Mortgage Soup’s article, “Only one in five of your clients thinks your fee was justified”, prompted a lively discussion about the work clients see and what happens behind the scenes.

Paul Flavin’s piece in Mortgage Soup cited TLF Research findings that 19% of homeowners surveyed considered their broker fee justified. That does not mean all remaining respondents thought it unjustified; some had no view either way.

Mirza highlighted the expertise and relationships needed to progress complex cases, including discussions with lenders, accountants and solicitors. Her message was that brokers need to explain how that work contributes to the customer’s outcome.

Arena added that the broker often becomes the central contact when something goes wrong, even where the problem sits with another party. Managing expectations and helping a client through a stressful transaction are skills that deserve greater recognition.

Foryzewski offered a personal example of a broker helping resolve complications during her own move. Her broker had not charged a fee, but she said she would have been willing to pay one. The example underlined the distinction between the value of advice and the business model used to provide it.

Chawatama described brokers sharing their criteria research with clients to explain why particular lenders had been considered. Baggott also highlighted AI’s role in reducing administration, allowing brokers to concentrate on finding solutions.

Together, those points suggested that faster processing makes it increasingly important to explain the judgement and support behind a recommendation.

REMORTGAGE SEARCHES JUMP

The panel also considered MoneyAge’s report, “Remortgage searches jump 44% in September”.

Twenty7tec recorded 860,951 residential remortgage searches during the month, up 40% on August and 44% on September last year.

Arena said increased activity was expected as fixed-rate periods ended. The more revealing question would be how much research resulted in a remortgage rather than a product transfer. Search volumes indicate activity, rather than completed lending.

He also highlighted the challenge of advising customers whose circumstances have materially changed since their previous mortgage. An existing lender’s product transfer offer may appear straightforward, while exploring a move to another lender can involve a fuller assessment of the borrower’s current position.

On buy-to-let, Foryzewski emphasised the relationship between pricing and affordability, alongside the anxiety landlords may feel when leaving a much lower fixed rate. Early conversations can help customers understand what they are facing and consider their options before a deadline becomes urgent.

HUMAN JUDGEMENT REMAINS KEY

Across the three discussions, the common thread was how to make informed lending decisions easier to reach and easier for customers to understand.

That means retaining building societies’ flexibility, showing the work behind advice and reassessing a borrower’s circumstances when their mortgage comes up for review.

You can register for the next episode HERE.