Why the second charge loan industry must not become reliant on sourcing systems
Since the implementation of the mortgage credit directive (MCD), the second charge mortgage industry has seen a flood of new sourcing systems enter the market.
Recently Shawbrook, Precise Mortgages and Together all integrated with lenderGateway , while over 1000 brokers have already used mortgage Brains new second charge system LoansBrain.
Industry leaders feel that while sourcing systems are an important part of the loan process there are dangers in becoming over reliant on them.
It is vital that the industry does not become reliant on computers alone to decide who should be acceptable for a loan.
The human touch that intermediaries provide, paired with technology can be the difference between a loan agreement and rejection for many borrowers.
Many of the sourcing tools currently on the market, which process countless applications a day, may miss vital information, for example affordability calculations and therefore risk rejecting possible borrowers.
Whilst sourcing systems have undoubtedly come a long way with tremendous amounts of Research and development having gone into making it faster and easier for brokers to find appropriate lenders products that match their client’s needs , we must never forget that there are sometimes ways for a lender to offer a product that aren’t always covered by a sourcing system.
For example irregular income or various forms of historical bad debt are best considered by an expert underwriter and decisions made on an individual case basis.
A good sourcing system should in essence be an extension of the service a business provides, it should work alongside the advisors and underwriters.
In the second charge lending marker there is flexibility in criteria that master brokers can refer to the lender on it would be difficult for a sourcing system to know where all the flexibility is for all the lenders.
Actually speaking to someone and making the most of their product knowledge and experience is not something that necessarily can be, or should be, replaced by a sourcing system.
For more information please do not hesiate to contact us at Hoskin Home Loans.
Hoskin Financial Planning Ltd is authorised and regulated by the Financial Conduct Authority number 613005. The guidance and/or advice contained in this website is subject to UK regulatory regime and is therefore restricted to consumers based in the UK. Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
