In the Spotlight with Niamh Downey, Bluestone
“We can expect the number of individuals with complex credit to increase, which presents both a challenge and opportunity for brokers and lenders.”
FR: You were recently appointed as head of business development at Bluestone Mortgages, can you tell us about your role and how you came to work in the specialist lending industry?
I look after our BDMs and our broker support team. I’m responsible for delivering sales targets as well as coaching and upskilling our telephony sales teams to provide the best possible service. In addition to this, I help provide strategic support across the sales and marketing team to enhance our proposition and provide support to our intermediary partners.
After completing my A Levels, I came to the realisation that university wasn’t for me and so I went straight into the world of work. Finance was always of interest to me and I started my first job in the industry as an administrator for a packager. My manager quickly realised that I was confident talking on the phone and my strengths lay in building relationships and problem solving. As a result, I was fortunate enough to be promoted to a BDM.
Working for a packager, dealing with complex enquiries on a day to day basis and trying to find a suitable lender for those cases, meant I was able to further my industry knowledge. I quickly realised that climbing up the ladder in the specialist mortgage market was the career path I wanted to pursue.
FR: How is the cost of living crisis impacting borrowers, and what can brokers and lenders do to support them?
With the Bank of England warning inflation could reach double digits this year and Ofgem increasing the price of energy, there’s no doubt the cost of living crisis is a real worry for many. These factors are squeezing consumer finances, forcing people to look at where they can save costs. For borrowers who have higher levels of debt, this could mean having to choose which bills to pay. As a result, we can expect the number of individuals with complex credit to increase, which presents both a challenge and opportunity for brokers and lenders.
However, the good news is that the specialist lending market plays a vital role in providing support for this new surge of ‘non-vanilla’ customers. From a lender perspective, we should be looking at an individual’s circumstances on a case-by-case basis to provide solutions built on real needs, rather than outdated rules and automated processes. In addition, with the Bank of England’s base rate having faced its largest rise in 27 years, and the market experiencing high volatility in swap rates, lenders must be on hand to support brokers with any changes being made and help them prepare for them. This, in turn, will enable brokers to better support their customers with their applications.
For brokers, proactivity will be more important than ever. It’s about reaching out to their clients and asking the right questions to help them with their finances, which could include looking at what finances they need to prioritise and highlighting any issues they need to address. As customer’s situations become ever more complex, brokers need to ensure they are creative in looking at the different ways in which they can support their customers.
Ultimately, brokers and specialist lenders need to work together to ensure these complex cases are packaged correctly, quality support is provided and the best possible service is delivered.
FR: How do you think the specialist lending industry will evolve over the next 12 months?
As customer situations become more complex and a growing number find it even more difficult to meet the criteria of high street banks, the demand for specialist lending is only set to grow. Specialist lenders, as a result, will need to evolve with technology over the next 12 months, to ensure their systems and processes are smooth and streamlined to best service the undeniable surge in borrowers. One solution to help lenders with this will be the introduction of Open Banking, which will make assessing affordability easier and more efficient, ultimately saving time in the process.
Specialist lenders will need to continue to provide support to underserved customers by constantly reviewing their criteria and adapting it to meet the needs of their customers. For example, this could be those with multiple income sources or the self-employed. Rising living costs are also creating a more complicated financial situation for many borrowers, so we’re likely to see a rise in the number of customers with impaired credit. Lastly, with the Help to Buy scheme coming to an end, we can expect to see more first-time buyers looking for alternative solutions.
As such, specialist lenders will need to widen their propositions to ensure they are offering as many avenues to borrowers as possible, while also being cautious of the risk, which could include longer fixed-term lending or flexibility on affordability assessments. The key actions for specialist lenders to take over the coming year are to maintain their human approach to underwriting and understand their clients’ personal circumstances as much as possible, while utilising technology to ensure fast turnaround times and quality service.
FR: Do you expect to see a rise in the number of customers with complex credit?
The cost of living crisis, combined with soaring inflation and energy prices, means a large number of customers are feeling the squeeze on their personal finances and as a result are turning to personal loans and credit cards more than ever to get by.
With people’s debt-to-income ratio increasing, some clients will inevitably have to choose which finances to pay and could miss payments on certain debts they have, whether that be credit cards, loans, or utility bills. All of this will have a knock-on effect on their credit score, leading to a rise in the number of customers with complex credit profiles. This could range from clients with missed payments on unsecured debt to customers with heavier and more complex issues, such as a debt management plan or an IVA.
FR: If you could read one headline about the mortgage market this year, what would it be?
The headline I’d like to read is ‘Stamp duty holiday makes a permanent comeback.’ Not only would this help generate market and economic activity by encouraging people higher up the housing ladder to move home, but it will enable first-time buyers to put more money towards their deposit.