BestAdvice fires the questions at Maeve Ward, director of commercial operations at Central Trust and Mercantile Trust
BestAdvice (BA): You’re director of commercial operations for two lending brands. How do they differ and is there anything they both have in common?
Maeve Ward (MW): The two brands are different in that Central Trust caters for all things regulated, residential mortgages and Consumer Buy-to-let (CBTL) while Mercantile Trust is all things unregulated – bridging, buy-to-let term and commercial mortgages.
The common theme is helping the underserved who struggle to find lending solutions.
BA: How do you see the current lending landscape for borrowers with adverse credit?
MW: I think the current landscape for customers with adverse credit remains as difficult as it always has been, unless they have been introduced to the specialist lending market where a more holistic underwriting approach can lead to a good customer outcome.
Sadly, I feel that the pandemic has been driving an uplift in borrowers with credit blips. This is due to changes in circumstances outside of their control, where extreme financial pressure may have led to missed payments, CCJ or defaults. All of these would have adversely affected their credit scores which might see them struggle with mainstream lenders who use automated decision engines.
BA: Are second charges being recommended enough by mortgage brokers? Why do you think this is the case?
MW: The growth in the second charge market would suggest more brokers are considering second charges. Education however is still key as the perception remains that second charges are expensive or the product of last resort. The reality however is very different; it is not unheard of for some lenders to offer rates sub 3% and whilst a remortgage might always be available it doesn’t necessarily mean it’s the right customer outcome.
BA: How would you say Central Trust and Mercantile Trust stand out from the competition?
MW: Central Trust and Mercantile Trust’s product offerings are niche; we focus on pockets of the market that requires a more holistic approach to lending or where there are fewer lenders.
Central Trust is known for helping customers to ‘repair and rebuild’ or operating in spaces where there might be a restricted lending appetite such as Northern Ireland, CBTL, lower property values, non-standard construction, complex income streams to name but a few.
Mercantile Trust is similar – lending to those just starting out on their investment journey (first-time landlord) or supporting those looking to utilise the equity within their portfolio whilst protecting preferential rates or costly ERCs via a second charge buy-to-let. It also helps other to borrow slightly more with the ability to top slice using surplus portfolio income, or those who are looking to diversify the portfolio by acquiring lower valued properties that might lend themselves to stronger rental yields, for example.
The magic of both propositions comes from its people who help us stand out from the crowd. We are passionate about making a difference and helping where others might not be able to. We’re always delivering on our promises and continually looking at ways in which we might be able to broaden our reach as opposed to chasing volume by dropping rates. The recent formation of the mortgage desk was the first step in a programme of many initiatives which will be introduced over the coming months. It provides support to brokers who are struggling to place cases but where it might make sense for us to lend, whilst also helping those new to second charge mortgages navigate their way around the process.
The desk also provides a platform for alternative lending by spotting a broker opportunity and referring them to a specialist master broker.
BA: Does service matter as much in the adverse credit arena as much as it does in the prime space?
MW: Service matters regardless of the profile of the client – just because customers have impaired credit doesn’t mean they should be treated any differently. Granted, they might have to provide more information on an adverse case but what’s required will generally be discussed as part of the advised sales process so should be readily available for the lender. The specialist market is quite progressed in terms of technology with many if not all lenders now offering a portal, full integration with Equifax and Land Registry, as well as utilising AVMs and e-signatures. These all speed up the customer journey by removing the need for manual entry, in turn improving accuracy whilst also reducing wait time.
BA: Mercantile Trust offers buy-to-let mortgages. What do you see as the key challenges facing landlords in the short to medium-term?
MW: I guess the leading challenge for landlords is the Energy Performance Certificate (EPC) changes that come into place in 2025 for new tenancies and 2028 for all tenancies. The average cost of the upgrade is said to be around £10,000 per property so many landlords will be looking at how and when they might make and fund those changes. A second charge buy-to-let is one way that landlords can make the changes, utilising the equity within the portfolio whilst protecting preferential rates or incurring costly ERCs. This in turn enables them to re-mortgage onto a favourable rate once outside of the ERC.
BA: You’re an experienced lending professional. What do you bring to the role?
MW: That’s a very hard question for me to answer, so I asked Alison Houghton-Corfield from Master Private Finance to answer it for me!
She said: “There aren’t many within the specialist finance industry, who by just name alone, are recognised instantly as stalwarts of honesty, integrity, love and kindness. Maeve Ward is one of those people.
“She always makes you feel relaxed, openly encourages any questions, actively listens to what you have to say and always offers relevant solutions.
“There’s not very many like her but so many can learn from her, as Maeve has a wonderful skill of unequivocally supporting and developing businesses and its people.”
BA: Finally, what aims do you have for Central Trust and Mercantile Trust?
MW: My vision is very much to grow both businesses over the coming months by broadening our proposition and extending our reach into other underserved areas of the market.
I also want to invest heavily into technology while still offering a holistic, human approach to underwriting and lending.
In addition, I’m passionate about investing in people and recognising talent so that we can be known for adding value wherever we go, as a lender that listens and delivers on its promises. We will continue to support the broker community, recognising them for the outstanding contribution they make to the market and helping customers find alternative outcomes.