This week has seen some of the few lenders back in 90 per cent LTV lending withdraw products due to unsustainable volumes impacting service levels. Accord Mortgages director of intermediary distribution Jeremy Duncombe explains the reasoning behind the decision and why he is calling for competition in the high LTV market.

Since lockdown started, we have worked hard to minimise the impact it would have on both our business and the business of brokers.

In March, our offices emptied, we took our sales teams off the road and our broker telephone advice line closed. But, within 24 hours, we improved the capacity of our webchat facility allowing both our business development advisers and our business development managers to be on call to respond quickly and effectively to broker queries.

In those first two weeks of operation we completed almost 4,000 chats, with every chat answered and an impressive average satisfaction score of 9.6 out of 10. At our peak, we’ve been taking almost 900 webchats a day.

When physical valuations were stopped, we sought alternatives to support as much lending as we could. Working closely with our valuation partners we were able to use more automated valuation models and implement desktop valuations, a completely new process for us which was put in place in record time.

When we were able to relaunch a range of 90 per cent LTV products on 20 May, just one week after our valuers recommenced, it was a huge achievement for everyone involved. We were offering our support to the market and, more importantly, enabling brokers to do their job by giving clients the best range of products to choose from.

Therefore, it goes without saying that having to temporarily withdraw this LTV range due to unsustainable volumes impacting our capacity to service brokers properly, was an incredibly difficult decision.

In the last week, Accord has experienced its two busiest days of applications in its 17 year history. Our webchat service saw 4,000 chats in a single week and our BDMs were taking more than 1,000 calls every day. Our underwriting teams, already working to their maximum capacity, were being inundated with new cases and the service levels we have become known for (and are the reason many brokers choose to place cases with us) were being negatively affected. Our key focuses throughout this whole period has been securing the safety and wellbeing of our colleagues and maintaining the best possible service for our brokers and partners. There was no other option but to pause lending at this LTV.

Since we withdrew others have followed, again unable to manage the incredible volumes coming through. There is simply too much demand for those few lenders currently offering products at this tier. And that, when looking at the bigger picture and assessing how quickly this market can recover, is a pretty good problem to have. People want to purchase. They are keen to move fast. Brokers are busy.

I’ve read a lot of commentary on this topic over the past few days, and whilst I can only speak on behalf of Accord, the sole reason we have withdrawn is due to the service implications. We have a very healthy appetite to lend and once service levels allow, we will be back in the 90 per cent LTV market.

Once this happens, we hope other lenders will be there too so there is enough supply to meet the demand, and to ensure that borrowers are getting as broad a range of rates, incentives and options as possible.

Competition is healthy, choice is good, capacity is vital and can only be of benefit to brokers and their clients. More purchases helps build confidence and more confidence helps rebuild this market.

In the meantime, we’re continuing to support lending up to 85 per cent LTV, are back in new build, Help to Buy and offering buy-to-let products up to 80 per cent LTV.