BestAdvice (BA): Why did you choose to join a specialist lender from a mainstream lender?
Paul Adams (PA): I recently learned a lesson from someone I have a huge amount of respect for. It was “Don’t wait. Life goes faster than you think, so don’t miss an opportunity if it feels right”. This opportunity feels right.
Changing demographics, shifting work patterns and a growing mountain of unsecured debt are leading to more customers whose circumstances don’t meet the automated approach of the high street. This means that criteria and flexible underwriting are more important and specialist lending is becoming essential for all brokers.
The key difference is that, with a mainstream lender, a case either fits lending policy or it doesn’t – there’s no room for judgement. But at Pepper Money, our underwriters have the power to assess an interesting case on its own merits. This puts more emphasis on offering brokers a solutions-based approach and this is something that I believe will be one of the key growth areas in the market.
BA: What can we expect from Pepper this year?
PA: Our job is to make it easy for brokers to find a home for their interesting cases and we will continue to do this through ongoing product development and investment in our talented and experienced sales team, working closely with intermediaries to deliver solutions and improvements to our proposition. We’re also working towards a banking licence and we are building towards a very exciting future.
BA: Do you think brokers still have misconceptions about the specialist market?
PA: Yes, and the biggest misconception is that specialist lenders are difficult to work with. Interesting cases can requiremore of a human touch than a standard mainstream application as underwriters review information in greater detail, but for brokers the process is exactly the same.
The best step a broker can make is to pick up the phone to a specialist lender at the start of an application to discuss the case, whether the lender will be able to do it and what documentation will be required.
BA: Do you think people have misconceptions about lenders?
PA: I think the biggest misconception is that lenders don’t listen to intermediaries. The one thing I have learned is that asking the right questions and listening carefully to brokers is the most important way of ensuring a lender is delivering what they want. So, I’ll continue to work closely with our intermediaries to ensure our proposition hits the mark.
BA: What do you think will be the key issues affecting intermediaries this year?
PA: It’s difficult to look ahead to the next 12 months without considering the impact the political environment may have on the economy and the housing market, but every year brings its own challenges and opportunities. I am confident that there is increasing opportunity for brokers to help a growing number of clients even if the property market is flat. So, I would say the key focus for brokers should be to make the most of the available opportunity.
BA: What do you expect the outlook to be for buy-to-let?
PA: Buy-to-let has absorbed the regulatory and tax changes that have been thrust upon it in recent years and demonstrated resilience with activity levels holding up well. There is clearly an ongoing demand for private rental property and so I think it’s safe to assume that the market will continue to be robust, but it has changed, with more landlords holding their investment in limited companies. So, I’d expect to see the continued growth of limited company buy-to-let.