The specialist mortgage market is becoming far more mainstream.
A host of events over recent years, from Brexit to the pandemic and beyond, has meant that increasing numbers of prospective borrowers are now classed as specialist.
In some cases, this may be down to some level of arrears that are no longer an issue. For others it may be down to their employment status, for example by going self-employed.
Still more simply have borrowing needs that lie outside of what regular lenders are comfortable with, and simply require a little more flexibility from their lender, such as those looking to borrow against unusual properties.
However, it’s important to recognise that there will be some brokers who feel some sense of trepidation about this trend.
The impact on brokers
It’s certainly true that the specialist market represents a step into the unknown for some brokers. There is no shortage of advisers whose cases have mainly fallen within the confines of what we might call ‘vanilla’ deals, meaning they had little cause to pay much attention to what was going on in the specialist space.
Yet as the market has shifted and increasing numbers of clients find themselves outside the parameters of vanilla lending, these brokers face a challenge.
They want to support those clients and do the best possible job for them, yet there are aspects of the specialist market that introduce an element of complexity in their understanding.
Opening the door for brokers
It’s with these brokers in mind that Mansfield Building Society is taking part in the One Stop Broker Series, a collection of online seminars designed to demystify the world of specialist lending for advisers.
These sessions will cover all things specialist, from residential and buy to let to bridging loans and development finance and include an interactive Q&A session with the industry panel.
The sessions are being held on 16th October, 13th November and 11th December, and interested brokers can register online to gain access.
The One Stop Broker Series is being chaired by industry veteran Roger Morris, and will feature the insights of Tandem, Quantum Mortgages and Glenhawk, as well as Mansfield.
The sessions are free to join, but spaces are limited so it’s important to register in advance. In addition, attendees will be able to claim 90 minutes of CPD.
Working together
The series is a great example of how important it is for the industry to work collaboratively.
It’s not enough to simply expect brokers to understand the intricacies of the specialist market or to leave it to brokers with experience in the area. Instead, we need to put the tools in place to help advisers become more comfortable with this area of lending and where it can and cannot support their clients.
Working together in this way not only means we can build stronger relationships with advisers, but it can also bring a fresh perspective to lenders. It’s through those discussions and Q&A sessions with brokers that lenders can get a better insight into whether their products and processes truly support clients, or if there are areas ripe for more innovation.
There are significant swathes of the borrower market who are going to have to make use of the specialist market in the months and years ahead. The fact that they no longer count as ‘vanilla’ applicants is through no fault of their own, and they still represent excellent customer options, yet mainstream lenders may no longer be willing to work with them.
That’s why it’s important for lenders to educate brokers on why there’s no reason to be wary of the specialist sector, and for brokers to brush up on their understanding. Specialist lending is likely to continue to grow, so it represents a great opportunity for us all.
Tom Denman-Molloy is intermediary sales manager at Mansfield Building Society