When the history of this period in the mortgage/housing market is written, I hope historians give due credit and ‘doff their hats’ to the incredible work of mortgage advisers through all of this.
To say that the last couple of weeks – indeed 2022 in general – has been challenging for advisers would be something of the understatement of the year, however it is to their absolute credit that they have been securing the best outcomes for so many clients during these unprecedented times.
Dealing with panicked clients looking at significant increases in mortgage costs, regardless of what they try to do, is certainly not the most enviable job on the planet right now, but without professional advisers I think we all know that the situation for those borrower clients would be much, much worse.
I hope in the future we reflect and rejoice on the fact that we have a market in which 75% of all mortgages are advised through the intermediary market. Without that crucial advice, how many borrowers would be acting rashly out of fear, taking the first product that was offered to them in the hope it was the best for their needs and circumstances?
I’ve already read of a number of cases where panicked borrowers have opted for the first product transfer they were offered, when if they’d taken it to an adviser, they would have been able to access a much better deal, or they could have been calmed by their adviser and potentially held on to see if better times/products/rates would come to market before they needed to act.
Advice has always mattered and should have always been the right option for every single mortgage customer, but this period will go a long way to showing why it really matters and the huge difference it can make to every single person worried about what they may have to pay in the future, particularly those who are coming to the end of deals over the coming days, weeks and months.
In that regard, my regard for advisers has never been greater, and the need for advice should continue to be shouted from the rooftops as this crisis plays itself out.
Which brings me to the crisis unfolding at present. It’s very difficult to write accurately about what is happening right now, knowing full well this may not be published until a few days after it’s written, but to say that the government has clearly got this spectacularly wrong, would again be a gross under-appreciation of the seriousness of what is befalling the UK economy and our market at present.
Sticking to housing, a decision which ultimately sees lenders forced to pull huge swathes of their product range, and to increase rates substantially for those that remain, beggars’ belief. The markets reacted to the ‘Mini Budget’ and now the government needs to acknowledge the huge error, and to reverse its decisions/measures before things get even further out of hand. Whether it will, remains to be seen.
The Bank of England – as I write – has just intervened to buy long-term government debt and it is to be hoped this begins to calm markets, and we do not end up reaching the levels of interest rate increases that many economists are suggesting we will require. However, it is extraordinary that it has to effectively shore up a situation caused by its own government – a self-inflicted series of wounds like nothing we have seen before.
Overall, it’s quite an obvious point to make but the situation is likely to get worse before it gets any better, and in terms of the mortgage market, we are looking at many weeks, possibly months, before we get any sort of recovery and normalisation. We will get there, but who is to say how long it will take?
What we can do is continue to support advisers in terms of helping them deal with their workload and to take the conveyancing strain off them, specifically in terms of remortgage business, to try and get these case completed as quickly as possible and to provide clients with the certainty they crave. Again, it is not an easy task, given that many conveyancing firms continue to deal with resource issues, but our panel firms are working hard to make this a reality.
This is clearly a tough market to navigate, however we can work our way through it with collaboration and communication. We’re here for you so please make the most of us.
Mark Snape is CEO of Broker Conveyancing