Could the mortgage market undergo Uber-ification?

No one has yet invented the mortgage industry silver bullet; the idea that could transform the industry as we know it. But as our CEO Mark Lofthouse explains, it may be somewhere on the horizon, and we must be prepared for it.

Want a taxi? Not a problem.

Go onto the street and hail one, or book one over the phone. Simple and straightforward. It’s always been done that way, always will be. But in 2011, two men launched the Uber app, which allowed anyone with a smartphone to make a trip request and have the cab closest to them make the pick-up. Five years on and Bloomberg estimated the company’s revenues to be around $5.5 billion dollars.

Airbnb is another strong example of how an idea can come out of nowhere and change an industry forever. No matter how inconceivable an idea, we must remember that the possibility exists that someone, somewhere could come up with it at any time.

uber

But why can it happen?

One of the reasons is that no one ‘owns’ the taxi space. In the same way that no one ‘owns’ the mortgage space. As radical as it sounds, anyone is free to come in and be a ‘disruptor’, and if people like the idea then it could change the rules and irrevocably alter the way mortgages are sold!

The mortgage industry is rarely at the front of the queue for innovation. Apps, for example, were well established in other sectors before arriving in the mortgage market. ‘Robo advice’, however you interpret it, is commonplace in areas such as car and home insurance and it’s now in its early stages for mortgages.

So what’s the chance that our industry will be altered?

No one has yet come up with an idea that could transform our industry, and the idea that someone could may not seem all that attractive. But we shouldn’t close our minds to them or discount the idea that someone, somewhere, could be working on something radical.

Although, we do have to ask ourselves: what would it be? Would it allow consumers to have mortgages that are tailor made? Mortgages that automatically change whenever a new and more desirable product appears? Maybe even a completely new way of buying a house that makes mortgages redundant at a stroke?

They are ideas which may not seem feasible, but in 2017 and beyond they could well become reality.

Ideas don’t always make you an overnight success

It is worth noting that Techcrunch.com reports that Uber’s losses are expected to hit $3 billion in 2017, Airbnb has had it run ins with authority, and there will always be plenty of people willing and able to piggy back on the success of early adopters. But the tantalising possibility remains.

So what can the industry do about it?

It’s hard to fight against something that doesn’t exist and that no one knows anything about, so the best defence is to make the industry as future proof as possible. This means moving with the tech times and offering as high a level of professionalism as possible. As the technology and service improves, so the window for uber-ification is reduced.

In the meantime, keep watching the skies.

Mark Lofthouse on the Importance of Client Retention

Last month, our CEO Mark Lofthouse had an excellent opinion piece published online. The column covered the importance of client retention, a significant area vital to mortgage brokers.

We’ve broken down the top points from Mark’s column so you can easily digest the important information that he covers.

Don’t ‘just sell mortgages’
Any adviser who just ‘sells mortgages’ isn’t doing their job as well as they could. Mark explains that a role of a mortgage adviser extends far beyond simply advising and selling mortgages.
They must value each customer as an individual, and treat him or her as such. He says: “It is critical that the needs of the customer are met and the review and advice process should look at the customer’s overall needs and not just their mortgages.”

This will in turn increase your income.
Mark goes on to say that, if you acknowledge the individual needs of each customer, you are more likely to receive a lifetime of recurring business. On the reverse, you may be missing out on a great sum of income because you’re not paying due care and attention to your customers.

Provide a broader service.
Following on, Mark advises that, although we don’t want to be selling customers things they don’t want or need, offering extra services to them is beneficial, as if the client sees the services as good value, “they’ll be pleased you’ve taken the trouble to give them that extra level of service,” thus leading to recommendations to friends and family.

Regular contact is paramount.
Don’t just contact your clients when they are due a remortgage. It is vital that your customers stay in your thoughts as often as possible, and finding out more about them means you will be able to offer them further services in the future.

Mark states: “Finding out more about clients’ financial affairs also gives you a reason to stay in touch, either as a courtesy call every so often or when one of their products is due for renewal.”

Keep on top of the industry.
Mark’s closing points underline the importance of keeping abreast of the constant changes in the market. He outlines a myriad of knowledge about each customer you need to know, such as “knowledge of the prevailing provider service levels, what clients enquired about last time you saw them, awareness of their financial situation, and if you know them well, where they went on holiday or what their children are up to.”

But you can’t store this in your own head! To keep all this vital information, and to ensure you are organised, Mark emphasises the importance of using up-to-date front and back office technology, which everyone has at their disposal and should be taking advantage of, for example, our CRM system, the Key.

Follow Mark’s tips to become a better asset for your clients, and remember that “advising on more than just mortgages might take you out of your comfort zone, but the rewards to you and your clients are well worth it.”

If you would like to read the column in full, you can do so by clicking here.