Broker satisfaction with UK mortgage lenders has fallen to the lowest level recorded outside of the pandemic, in the wake of the turbulent economic climate following the mini-budget and the cost-of-living crisis, data from Smart Money People shows.
Intermediary satisfaction with lenders is down 1.9% to 79.3%, in the financial services platform’s twice-yearly Mortgage Lender Benchmark report, which began in the second half of 2018. This is the first time this measure has fallen below 80% since the second half of 2020, when it hit 77.8%.
The survey’s net promoter score, how likely a broker is to recommend a lender, fell 5.8 points compared to the first half of the year, to an average of 21.1. Scores ranged from minus 54.5 to 59.3 for the lenders in the report.
Top broker-rated lenders in the second half of 2022 were:
○ Top bank: Halifax
○ Top building society: The West Brom
○ Top buy-to-let lender: Foundation Home Loans
○ Top specialist lender: Foundation Home Loans
○ Top lifetime lender: Canada Life
The report comes after chancellor Jeremy Hunt calmed international debt markets in October, by largely reversing former chancellor Kwasi Kwarteng’s tax-cutting mini-budget on 23 September, which saw the number of products on the market fall sharply while remaining loan prices jumped. Hunt went on to consolidate his measures in the Autumn Statement last month.
Also, on 3 November, the Bank of England increased the base rate by 75bps to 3%, the biggest since 1989 and the eighth time in a row it has lifted rates. Last year in November the base rate was 0.1%.
The survey points out that building societies are the top-rated sector for broker satisfaction for the ninth time in a row.
Specialist lenders broke their streak of improvement, with overall satisfaction ratings down by 5.5% compared to the first half of the year.
Broker ratings for lifetime lenders saw the smallest change with overall satisfaction down by 1.1%, and have improved their rating for speed by 2.4%.
Intermediary satisfaction with relationship managers slipped by 1.1% to 77.8%.
The report says: “Brokers are struggling to keep up to date with rapidly changing criteria and rates, with 43% relying on emails to keep updated with changes.”
It adds that specialist lenders saw “a considerable fall” in their metrics following previously recorded improvements. Overall satisfaction fell by 5.5% to 75.0%, and their net promoter score tumbled 24.6 points, to just 1.2.
However, lifetime lenders saw the smallest change in overall satisfaction, down 1.1%, and their rating for speed increased by 2.4% to 73.8%, overtaking bank ratings.
Smart Money People chief executive Jacqueline Dewey says: “The results we’ve published today shows a sharp drop off in brokers’ opinion following three editions of growth as UK lenders struggle to cope with the impact of the interest rate rises and turbulence caused by the mini-budget.
“Our analysis shows that broker satisfaction with mortgage lenders is now nearing the lowest recorded levels seen during the height of the pandemic.
“Brokers are frustrated by the situation they find themselves and their clients in, with constant changes and products being withdrawn after applications have been submitted.
“Our analysis has found brokers are craving some stability within the market, and that brokers need support from lenders – they need to be able to rely on and have confidence in lenders, and whilst processes adapt, communication remains key.”
The ninth edition of the Mortgage Lender Benchmark report, surveyed over 751 brokers on 114 lenders, with further analysis on 51 lenders across banks, building societies, specialist lenders and lifetime providers, including general views of intermediaries on the mortgage market.
