Tag Archives: criteria hub

Laying the foundations for self-builds

Self-build mortgages are increasingly becoming an untapped source of business for UK mortgage advisers. Recent research from Ipswich Building Society reveals that over a third of UK adults (35%) are considering a self-build project at some point in the future[1].

There are many aspects that encourage those looking for a new home to build their own. 51% of respondents were attracted to a self-build option because it provides the ability to specify the layout. 28% said that being able to make environmentally friendly decisions during the process appealed to them, and 17% cited economic or financial benefits as a key factor in their decision.

But there was one aspect of self-building that almost half (46%) of respondents saw as a major challenge, the financing of the build, and indeed 72% of those wanting to build their own home didn’t realise they would require a specialist self-build mortgage.

What’s different about a self-build mortgage?

A self-build mortgage is designed to suit the elongated process of building a new home which is usually completed in various stages. Therefore, funds are released to the client to try and tie in with the completion of each stage rather than a lump sum being offered up front, as happens with a standard residential mortgage. This is ideal for situations where the client has a lump sum ready as a deposit for the land to be built on, as well as the first stage of the build.

And it’s not just new build projects that can benefit from a self-build mortgage, they can also be used for:

  • Conversions
  • Renovations
  • Demolish and rebuild projects
  • Mid or partially built projects

Self-building in the UK

The size of the UK self-build market is estimated to account for between 7% and 10% (12,000 homes per year) across the UK[2]. This is supported by data from the National Custom & Self-Build Association (NaCSBA) that shows the number of self-builds growing steadily since the introduction of self-build registers in 2016 to a total of 15,902 in 2019[3].

Whilst the NaCSBA data shows that the UK is lagging behind much of Europe with self-build accounting for 80% of new homes in Austria and 60% in countries such as Sweden, Norway, Italy and Belgium[3] , the government’s Right to Build Scheme, passed in 2016, could result in a yearly increase of some 35% in custom and self-build properties[4]. Additionally, the Right to Build Scheme allows local authorities to make more plots available to self-builders, making it easier to find that perfect location, although the average price of a plot can vary drastically throughout the UK with a few miles making a huge difference. For instance, a plot in Portsmouth could sell for around £371,250, whereas just down the road in Southampton, the average price for a plot could be £156,666. And a plot in Liverpool could set a self-builder back more than £800,0004.

Building plots are also now easier to come by with brownfield sites being made available. These are areas of land previously developed for commercial, agricultural, or industrial use, and local authorities now hold registers of brownfield land suitable for housing. Ipswich Building Society’s research showed that 31% of potential self-builders were not aware of this, although 61% said it would help them find a plot once they were made aware of brownfield sites[5].

Finding the right self-build mortgage

Of course, for a mortgage adviser, finding a specialist self-build mortgage for a client can be time-consuming. It could mean hours on the phone to a variety of lenders, with no guarantee of finding the perfect product for a client.

That’s where Criteria Hub can make a world of difference. It has over 50 criteria relating to self-build, plus a range of questions that assist with the applications, making the process quick and simple with just a single search of over 70 lenders required. This means an adviser can find what maybe once was considered to be a niche product just as easily as an everyday residential or buy-to-let product.

Whatever type of mortgage you need to find, Criteria Hub delivers many benefits:

  • Match criteria from over 70 lenders for both residential and buy-to-let
  • Over 30,000 criteria to compare
  • Ability to flag criteria that are critical or a deal-breaker
  • 1000s of additional criteria not found on lender websites
  • Standardised terms make it quick and simple for lenders to update their criteria

Maybe it’s time to look at Self-build clients and start laying the foundations for boosting your business? To find out more about Criteria Hub email sales@mortgage-brain.co.uk or simply register to become a Criteria Hub user with a 30-day free trial.

[1] https://www.ipswich-intermediaries.co.uk/blog/over-a-third-of-uk-adults-are-considering-a-self-build-project-so-here-s-the-latest-data-on-this-potential-group-of-clients

[2] https://www.york.ac.uk/media/chp/documents/2013/Lloyds_A4%20report%20v2-final%20NEWno.2.pdf

[3] https://nacsba.org.uk/news/single-dwelling-data-shows-self-build-numbers-growing/

[4] https://www.insulationexpress.co.uk/blog/uks-biggest-self-build-opportunities/

[5] https://www.ipswich-intermediaries.co.uk/blog/over-a-third-of-uk-adults-are-considering-a-self-build-project-so-here-s-the-latest-data-on-this-potential-group-of-clients

Working around the impact

The COVID-19 pandemic has had a huge impact throughout the world with almost every industry and market affected by it. Certainly, the mortgage industry has and continues to face many challenges. Lenders, advisers, and their customers face logistical challenges as they navigate ways to work efficiently from home, without face-to-face contact and for some there will be additional financial pressures.

Mortgage holidays

With normal working practices thrown into disarray and businesses losing large percentages of their income, the knock-on effect meant many homeowners could be faced with financial hardship. To help support borrowers, the government announced that mortgage lenders would offer three-month payment holidays to try and ease the burden and this has subsequently now been extended[1]. It is estimated that almost one-in-five UK mortgage holders have now been granted a payment holiday, which equates to around 2M Britons[2].

In response to the continued financial challenges faced by many consumers, a series of proposals have been developed to help borrowers who are continuing to struggle with mortgage repayments[3] including:

  • Granting those who have not yet taken a payment holiday until 31st October 2020 to apply
  • Enabling borrowers coming to the end of a payment holiday, but still in need of support, to request another three-month payment holiday
  • Stating that at the end of the payment holiday lenders should contact borrowers to agree whether to spread the cost of missed payments over the remaining mortgage term or to extend the term
  • Extending the ban on repossession of houses until 31st October 2020
  • Clarifying that payments missed through payment holidays or partial holidays will not affect a borrower’s credit score

Mortgage products almost halved

COVID-19 also heavily impacted the UK housing market. In the middle of March, mortgage lenders were forced to review their offerings due to the operational obstacles that the lockdown imposed, including the requirement to continue servicing and supporting existing customers, the process of mass migrating day-to-day operations to a home based set up, and the inability to obtain physical valuations. The consequences of these factors resulted in numerous product withdrawals or amendments alongside multiple policy and criteria changes. Meanwhile, buyers and sellers were urged not to move or hold viewings during the lockdown[4].

Recent Mortgage Brain data (as of 27 May) shows that when compared to pre-pandemic levels, the number of mortgage products available is 42.4% lower than the nine-week average to 16th March[5]. However, it is not all bad news, there is cause for cautious optimism as that figure appeared to bottom out during the week ending 12th April and the last five weeks have shown a steady rise in the number of products, resulting in a 13.8% (8,450) increase on the lowest level4.

Technology at the forefront

For many of the problems the pandemic has given rise to, technology frequently provides an answer. With the battle against Coronavirus demanding everyone observes social distancing, while there was a boom in remortgages, the housing purchase market slowed[6], with the knock-on effect being felt by the mortgage industry. But out of these problems, could we have found different ways of working that change our lives for the better?

Times like these bring about radical innovations and new solutions to tackle these obstacles. If you’re trying to buy a house, a viewing in person was not allowed during the lockdown. Now, although possible again, many buyers and agents may be sceptical about the safety of viewing in person. This has given rise to virtual viewings as there is no need keep to the two-metre rule but moreover it provides a widely accessible experience that buyers and agents can perform from the safety of their own homes whilst reaching a larger audience than ever, without the constraints of having to align the scheduling of the seller, buyer and agent[7]. This innovation appears to have surpassed the old way of working with a more convenient and efficient process, and with the addition of drone technology, exteriors of larger properties can be impressively showcased too. Perhaps this could become a part of the new normal?

Another heavily impacted activity has been the hosting of in-person events with countless roadshows, seminars, exhibitions and conferences having to be cancelled as venues close with little idea of when they may reopen. Once again, technology has been leveraged to provide a substitute through online events. Whilst you can’t pick up your goodie bag full of handy gadgets or enjoy a smorgasbord of snacks, think of the stress, travel time, and cost negated by not having to make travel and hotel arrangements. Not to mention the positive effect on your carbon footprint. Could virtual events also become a part of everyday business life after lockdown?

Support for the market

At a day-to-day level, innovation within technology itself has also provided a channel of support with companies like Zoom and Google constantly and rapidly evolving their offerings to meet the new needs of a digitally expectant world.

Within the mortgage industry it is a similar situation. Rapid changes to products available, policy and lenders’ criteria have proved challenging to keep track of due to the number of channels providing information and the constant nature of the changes. To aide this, several support hubs emerged in the market offering support to various groups. However, in April, Mortgage Brain delivered a new breed of support hub that took a holistic view of the market and consolidated everything in one place to provide a single source of truth and help combat the information overload.

Developed to support advisers and lenders alike during these challenging times, the COVID-19 Support Hub was made available on Criteria Hub and relays the truth about the pandemic’s impact on the industry across policy, product and news as well as containing easily accessible resources including:

  • Lenders Impact Page allowing you to access regularly updated information populated direct from the lenders themselves, and
  • COVID-19 News Portal displaying criteria, product, and industry news as it is released

Mortgage Brain made its COVID-19 Support Hub available to everyone by hosting it publicly to ensure all advisers had access to the updates they needed to be able to monitor the rapidly evolving marketplace. Taking it a step further, Mortgage Brain also made the Criteria Hub platform free to registered users for at least 90 days (*offer ended 31 Jul 2020) so they could further filter through the noise that the Coronavirus outbreak brought.

Innovation at the core

Mortgage Brain has long been a mortgage technology expert and market leader, and COVID-19 has proved the value of its innovative solutions through its ability to keep advisers working efficiently, from wherever they find themselves.

Inevitably, the need to work from home and the lack of face-to-face meetings with clients has created its own challenges. But Mortgage Brain solutions like The Key with its Client Portal, make  communication with clients secure, quick, and simple through encrypted online messaging. Meanwhile, its case tracking functionality means both adviser and client know exactly how a case is progressing 24/7.

The latest version of The Key includes new remortgage review functionality which can monitor when a mortgage rate is due for review, suggest potential replacement products complete with savings, and automatically email a customer and urge them to contact their adviser.

Whilst the purchase market slowly starts to move, ConveyancingBrain offers a way to take advantage of the surge in demand for remortgages which currently accounts for 65% of market activity[8]. It’s quick and simple to send a cashback or fixed fee remortgage to earn referral fees of up to £300 and the case tracking functionality within ConveyancingBrain means customers can always see how their case is progressing.

How long will COVID-19’s impact on our market last? No one really knows. And who is to say what the new normal will be for the industry, but the pandemic has undoubtedly served as a catalyst for innovation and digitalisation, the impacts of which will revolutionise the way we all work. To find out more about Mortgage Brain’s suite of powerful solutions that together offer a seamless end-to-end journey from sourcing through to conveyancing, email sales@mortgage-brain.co.uk

*The 90-day trial offer ran from 20th April – 30 July 2020 and is no longer available

[1] https://www.which.co.uk/news/2020/05/coronavirus-how-to-apply-for-a-three-month-mortgage-payment-holiday/

[2] https://www.theguardian.com/money/2020/may/09/mortgage-holidays-cost-payments-coronavirus

[3] https://www.moneysavingexpert.com/news/2020/05/homeowners-set-to-be-able-to-extend-mortgage-payment-holidays/

[4] https://www.moneysavingexpert.com/news/2020/03/home-buyers-and-renters-urged-to-delay-property-moves/

[5] https://www.mortgage-brain.co.uk/pdf/press-release/news-product-and-esis-numbers-up-again.pdf

[6] https://www.theguardian.com/business/2020/mar/26/housing-market-frozen-by-government-during-coronavirus-lockdown

[7] https://www.homesandproperty.co.uk/property-news/london-property-coronavirus-virtual-viewings-a137631.html

[8] https://www.mortgagesolutions.co.uk/better-business/2020/05/22/mortgage-market-has-bottomed-out-but-new-abnormal-awaits-lofthouse/

A single source for truth

The COVID-19 pandemic has forced all of us to rethink the way we do business, bringing technology to the forefront as vast amounts of the UK workforce migrates to working from home.

This has undeniably brought challenges across financial services, notably within the mortgage industry for lenders, for you, and your customers, as the shape of the mortgage industry continues to change almost daily.

Some of the most rapidly evolving changes have occurred as a result of mortgage lenders reviewing their product ranges and policies for new and existing customers alike, mainly due to operational constraints and to support the government’s payment holiday scheme. It is now reported that 1 in 7 mortgage holders in the UK have requested a payment holiday[1].

On 14th April Mortgage Brain reported the number of products available were down by 7,179, 49.1% lower than the nine-week average to 16th March.

Supporting simplicity

Keeping up to date with the frequency and complexity of the changes poses new challenges for your business including how to best obtain timely, accurate information, and understand how these rapid changes are impacting your business and your clients. Particularly as an overwhelming amount of information is posted across a multitude of channels by numerous sources.

As mortgage technology experts, at Mortgage Brain, we take pride in the accuracy, timeliness and relevancy of the information we publish and have available within our sourcing and criteria solutions. Throughout the COVID-19 pandemic we have enhanced our efforts to provide access to accurate and relevant information by allowing users of our offline sourcing product to access the online version for free for at least 90 days. And, we extended this offer to Criteria Hub for new users*, while also inviting lenders to update their policies on the platform in real-time.

During these challenging times, we have also acted upon customer feedback to provide additional support through a platform to relay the truth of COVID-19’s impact on the industry across policy, product, and news, all from one source. With this in mind, on 20th April, we proudly announced the launch of a newly developed, bespoke solution in the form of the COVID-19 Support Hub on Criteria Hub.

Introducing our COVID-19 Support Hub on Criteria Hub

Our dedicated support hub contains easily accessible resources including:

  • Lenders Impact Page allowing you to access regularly updated information populated direct from the lenders themselves; and
  • COVID-19 News Portal displaying criteria, product, and industry news as it is released

The platform is open to everyone and provides a single source for mortgage industry updates at this time of uncertainty. However, fully registered Criteria Hub customers can also benefit from access to specific policy notes directly from lenders on the page, and from within Criteria Hub itself, to assist with customer advice at a time when clarity is more important than ever.

Criteria Hub remains free for at least 90 days to new users, enabling all advisers to take advantage of its latest features (**offer ended 31 July 2020). Register today, and equip yourself with the knowledge to support your clients during these difficult times by visiting the Criteria Hub Support Hub or emailing sales@mortgage-brain.co.uk.

Any existing customers that would like to have a demonstration of the new functionality can email sales@mortgage-brain.co.uk to arrange a free online session.

* Please allow two working days to process applications

**The 90-day trial offer ran from 20th April – 30 July 2020 and is no longer available

[1] https://www.mortgagesolutions.co.uk/