I suspect the circumstances advisers find themselves in today might not be what they expected when we began to emerge from the lockdown in May. Back then, there were plenty of concerns whether demand would return and a possible collapse in house prices.

We are yet to see the long-term effects of this crisis, but for the moment the housing market is as busy as ever. Lenders are facing unprecedented demand from customers, a Stamp Duty cut is encouraging buyers to take their first and next steps, and just this week Rightmove predicted a ‘mini-boom’ as asking prices reached record highs.

This is a positive place for the market to be given the pandemic and unprecedented lockdown, but our new normal isn’t without its challenges. Customers that have put their housing plans on hold during the lockdown are now eager to press ahead while others will be desperate to make the most of the government’s stamp duty holiday.

Channelling and managing demand

 Every business is still adapting to the post-lockdown world and with the levels of demand we are currently seeing, processes are going to take longer than what we’re used to. Lenders in particular are having to adapt to two key changes, so to paraphrase the words of a personal favourite, Take That, we all need to ‘have a little patience’.

Lenders were already trying to cope with pent-up demand while handling the on and off boarding of payment deferral enquiries, with the majority of their staff still working from home. Now as a result of the Stamp Duty holiday, advisers will have seen the relaunching and withdrawing of 90 per cent LTV mortgages as lenders try to manage demand and ensure operational capacity isn’t breached.

Without a doubt, the coronavirus crisis has made lending a more complex affair. Customers that may have been cleared for a mortgage in March might now be in a very different position, so advisers can and should expect more questions as lenders try to establish risk and make sensible lending decisions. In some cases, lenders may even want to reassess customer affordability, and manual intervention from underwriters will also become more prevalent, particularly for borrowers who may be self-employed or have complex incomes.

The market today certainly isn’t business as usual for lenders; they will have to channel and manage this mini-boom in demand very carefully to effectively service both new and existing borrowers.

Understanding

We’re all in this crisis together and advisers have an important role to play. Unfortunately, I’ve already heard of a number of instances where customers have been aggressive towards solicitors, for instance, so advisers will need to manage their customers’ expectations when it comes elongated mortgage application times.

Even simple measures can have a big impact. For example, taking the time to fully understand the packaging requirements of lenders and making sure that underwriters have all the supporting documentation and information required will result in faster application times.

Adopting more technology can also help. The Covid-19 crisis has brought about thousands of criteria changes across the mortgage market, with products being launched and withdrawn each day and lender requirements changing regularly.

Drawing on the knowledge of the lender’s BDM will continue to be vital, but advisers should also consider using web tools and even systems such as SmartrCriteria to keep up to date on the latest changes and requirements. Implementing relationship management software, electronic identification and verification tools and even enabling clients to upload documents onto portals will all help to create a smoother mortgage application.

Never forget where we’re coming from

Despite today’s challenges, I believe that many advisers would take the market we have today over what we were all facing back in late March and April, and in some respects even prior to the crisis. It is easy to take a ‘grass is greener’ view of the market pre-crisis, but it too had plenty of issues.

Following the regulator’s market review, we saw much discussion regarding the rise of execution-only transactions and questions around whether advice was needed for some customers with ‘straightforward’ mortgage needs.

At Legal & General Mortgage Club, we have always sought to champion the valuable role advisers play for borrowers and in today’s market we believe the value of advice is now more important than ever. From payment holidays to furlough and the potential for this crisis to create a new wave of credit-impaired borrowers, more customers are certainly going to need to support of an adviser to help them find the right mortgage in a market with ever-changing product criteria.

Many lenders stood side-by-side with advisers during the lockdown, so advisers now have the opportunity to help them respond to this surge of activity. Managing our own expectations and those of customers will be key to better borrower outcomes, and that means having just a little patience as we navigate through these unprecedented times.

Craig Hall, Head of Broker Relationships and Propositions, Legal & General Mortgage Club