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Mortgage
Issue 26
Autumn 2020
Professional
FORWARD
MOMENTUM
As the mortgage sector jolts back into
life, professionalism has never been
more important
A helping hand On guard Negative feedback
The impact of the The fight against increasing Are negative interest rates
Help-to-Buy extension mortgage fraud on the horizon?
INTRODUCTION
EMBRACING THE
CHALLENGES
Laura Gauden introduces her most challenging years I have seen in my career and
role as part of the SMP and that is saying something! We have always worked in
an evolving sector, but the challenges of Covid-19
describes how the Society really have tested our business – and mental strength.
has been helping members I have been delighted to see so many embracing the
challenges and finding new ways of continuing to
find new ways to continue to provide high quality advice to their customers.
provide high-quality advice Our events have moved to the virtual world for the
rest of this year, however, we are planning, subject to
to customers government advice at the time, to recommence our
valued face-to-face events early in 2021.
EXPANDING YOUR KNOWLEDGE
Holistic mortgage advice brings with it not only
W
the regulatory minimum qualification but also
2 protection, equity release and later life knowledge.
elcome to the new These markets are ever growing and evolving and
edition of Mortgage Professional. the need for advice into later life is becoming more
My name is Laura Gauden and I am prevalent. Many mortgage advisers are already equity
the new national account manager release qualified but if you are yet to venture into this
for the Society of Mortgage sector then we can provide you with the options open
Professionals. I meet with, to you, whether you are qualified with the CII already
and work with, businesses across the profession, from or even if you are qualified with another awarding
mortgage and protection firms to lenders and distributors. body we could recognise your existing qualifications.
My overarching aim is to support firms and Get in touch for more details if you are thinking of
organisations to drive professional standards within the expanding your advice to include these other
sector and to make sure the consumers see members of key areas.
the SMP as the professional place to go when seeking More business principals are asking me about
mortgage advice. Offering guidance and support for the benefits of apprenticeships, especially with
all learning and development undertaken in the sector the current government incentives, and there is
helping to further demonstrate knowledge, professional a common misconception that these are just for
ethics and a customer centric culture. the young. We now have an established Mortgage
My goal is championing the value of holistic Apprenticeship Scheme that is growing in popularity
professional mortgage advice and I do this as part of a and this can be used for new recruits or existing
national team, all here to help and support your business. staff looking to change role. Also keep an eye out
As a profession, building confidence in our services and for our good practice guides as we produce more of
earning the trust of our customers has never been more these in key areas, most recently offset mortgages and
important. High quality, professional, holistic advice is how to spot and prevent mortgage fraud. I hope you
essential and our members do provide that. For those enjoy the new ezine and I look forward to meeting
customers who do not have a trusted adviser, how do many of you in the coming months, even if that is
they find one? This is one of the many reasons we have initially virtually. In the meantime, do get in touch
recently launched SMP Associate Firm status. See David if I can be of any assistance to you and your business:
Thomas’s article on page 8 for more detail, why not laura.gauden@smp.org.uk ●
become an associate firm of the SMP and promote your
professionalism as a firm to new and to existing clients? Laura Gauden is national account manager for the Society
What a year 2020 has been so far, probably one of the of Mortgage Professionals
ISTOCK
smp.org.uk / Mortgage Professional / Autumn 2020
STA M P D U T Y
WILL THE
STAMP DUTY HOLIDAY
TEMPT BUYERS BACK?
Mortgage companies generally welcome any government
incentive that encourages house buying, but is the stamp
duty holiday enough? Liz Booth reports
3
M
ortgage
advisers have
generally
welcomed
the stamp
duty holiday
announced
in July by UK Chancellor Rishi
Sunak, but the holiday comes with
some drawbacks and the question is
whether it will be enough to tempt
buyers into the market.
smp.org.uk / Mortgage Professional / Autumn 2020
STA M P D U T Y
The housing market faces a
period of real uncertainty,
and [the Chancellor] wants to
get it moving. The fact he feels
intervention is needed raises a
point of caution in itself
4
Some property experts are mortgage freeze means that many once the holiday ends.”
predicting it means nearly nine out first-time buyers will have to stump He points out that non-residents
of 10 transactions will no longer up much bigger deposits. On top of purchasing dwellings after 1 April 2021
be subject to stamp duty and the that, there is the looming recession will be particularly hit. They will lose
average stamp duty bill will fall by and ongoing uncertainty over house the holiday and suffer an additional
£4,500. And in London and the prices, he said. 2% surcharge. This means that if they
South East, home to more expensive “The housing market faces a purchase an additional dwelling after
properties, buyers could save up to period of real uncertainty, and [the 1 April 2021, they will suffer a total
£14,999 overnight. Chancellor] wants to get it moving. surcharge of 5% (3% plus 2%).
Property company Zoopla said: The fact he feels intervention is Mr Randall also stresses past
“Our calculations in April showed that needed raises a point of caution in experiences, saying: “The aim of the
housing transactions could be down itself. Plus of course, as the stamp holiday is to maintain confidence in
by 50% this year” and so welcomes duty rise is temporary, it could cause a the housing market following the
any incentive. But it points to the demand bubble.” coronavirus pandemic. The jury is out
use of the word holiday, which gives Sean Randall, a partner at lawyers on whether it will achieve that aim.
would-be buyers an impetus to act Blick Rothenberg echoes that, The experience from past stamp duty
because it’s not a permanent change. warning: “Many economists have holidays is mixed.
However, property expert Phil said that we are entering the deepest “They accelerated transactions
Spencer has warned of concerns about global rescission since records began. but did not increase the number of
what will happen at the end of the If the UK government’s efforts to stem transactions and sellers tended to
stamp duty holiday period, in March rising unemployment fail, property benefit by almost half of the stamp
next year, worrying it’s going to be prices may fall. duty saving by increasing prices.”
a “cliff edge” and predicting a huge “It is possible people will wait until However, on a more optimistic
drop in the market as soon as the the start of next year to try to benefit note, both he and Mr Lewis suggest
deadline hits. from the holiday and a fall in property the potential ‘multiplier’ effect
And Martin Lewis, of prices. One thing is certain: the is possibly more significant. “The
MoneySavingsExpert said the current volume of sales will fall significantly housing market supports many jobs
smp.org.uk / Mortgage Professional / Autumn 2020
STA M P D U T Y
THE CHANGES
Residential Rates on purchases from 8 July 2020 to 31 March 2021
If you purchase a residential property between 8 July 2020 to 31 March 2021, you
only start to pay SDLT on the amount that you pay for the property above
£500,000. These rates apply whether you are buying your first home or have
owned property before:
Property or lease premium or transfer value SDLT rate
Up to £500,000 Zero
The next £425,000 (the portion from £500,001 to £925,000) 5%
The next £575,000 (the portion from £925,001 to £1.5 million) 10%
The remaining amount (the portion above £1.5 million) 12%
From 8 July 2020 to 31 March 2021 the special rules for first time buyers are
replaced by the reduced rates set out above.
ADDITIONAL PROPERTIES
Higher rates for additional properties
The 3% higher rate for purchases of additional dwellings applies on top of 5
revised standard rates above for the period 8 July 2020 to 31 March 2021:
Property or lease premium or transfer value SDLT rate
Up to £500,000 3%
The next £425,000 (the portion from £500,001 to £925,000) 8%
from home furnishing retail to home
The next £575,000 (the portion from £925,001 to £1.5 million) 13%
removals, tradesmen to estate agents,
etc. This measure is part of the plan to The remaining amount (the portion above £1.5 million) 15%
save jobs,” says Mr Randall.
But what are the professional
investors saying. No surprise really
but property investment house
RW Invest is bullish, suggesting:
“If you are a first-time buyer in the LEASEHOLD
UK property investment market,
or even considering building your New leasehold sales and transfers
portfolio without investing money The nil rate band which applies to the ‘net present value’ of any rents payable
in the stock market, the time to start for residential property is also increased to £500,000 from 8 July 2020 until 31
investing in UK property is now. March 2021:
“While past statistics have shown
Net Present Value of any rent SDLT rate
that property prices tend to drop
following rocky periods, this period Up to £500,000 Zero
of low growth is often short-lived. Over £500,000 1%
The property market has shown time Companies as well as individuals buying residential property worth less than
and time again how resilient it can be £500,000 will also benefit from these changes, as will companies that buy
and many savvy investors are taking residential property of any value where they meet the relief conditions from the
advantage of recent economic changes corporate 15% SDLT charge.
that can help them get the most out of ● On the 1 April 2021 the reduced rates shown will revert to the rates
their investment.”● of SDLT that were in place prior to 8 July 2020.
Source: gov.uk
Liz Booth is contributing editor to SMP
smp.org.uk / Mortgage Professional / Autumn 2020
H E L P -T O - B U Y
HOME
HELP
As the government prolongs
6 the Help-to-Buy scheme,
Aamina Zafar finds
out what the extension
could mean for advisers
T
he two-month extension
to the Help-to-Buy (HTB)
scheme still “leaves
significant gaps for the
new build market”, an
expert has warned.
Association of Mortgage
Intermediaries CEO, Robert Sinclair,
argues that there is still a “gaping hole
in the market” and “a lack of joined
up government thinking”, which the
current two-month extension does
not solve.
This comes as the UK government
extended the HTB deadline for the
construction of homes to be completed
by the end of February 2021 to comply
with the equity loan scheme.
Mr Sinclair says: “The recent
extensions allowed on HTB leaves
significant gaps for the new build
market. As new homes need to be
completed by year end, or by end of
smp.org.uk / Mortgage Professional / Autumn 2020
S P E HC EI AL LPI-STTO -F BI NUAYN C E
February by exception, to qualify for be sufficient. By not simultaneously role in helping their clients navigate
the existing scheme with current build extending the legal completion through the changes.
out rates, few current plots qualify with deadline, we may have a perfect storm He says: “For advisers the main
any certainty. Completing existing brewing that could cause massive additional challenge is likely to
commitments is the priority for builders. headaches for all stakeholders involved. be helping clients manage the
As the new scheme is not realistically This would be due to many last-minute new deadlines, especially where
available for applications until October build completions by developers (who developers have given an over
with first completions from April 2021, have already lost around three months’ optimistic completion date. Clients
there is a gaping hole in the market, at build time), which would lead to many should be warned about the risks of
a time when the chancellor has tried to last minute valuations and stretching completing on a home not properly
provide real impetus. The stamp duty the resources of many lenders that have finished just to meet the deadline and
reductions should mean a boom. Instead already seen turnaround times and should be recommended to speak to
there is a void due to a lack of joined up services levels creep up post-lockdown; their solicitor about options to protect
government thinking on this key topic.” increased number of buyers rushing to their interests in that situation.
The HTB scheme had been expected to complete due to stamp duty ‘mini- “Some clients whose completion
close at the end of the year, but a delay in holiday’ also ending on 31 March 2021; date is delayed, including those
construction work due to the pandemic last but not least, a possible second extended beyond March, will need
left thousands of homebuyers fearful they wave of rising Covid-19 infections could their mortgage offer extended and the
may miss the deadline. throw another spanner in the works,” sooner this is addressed the better,
Lobbying then forced the government says Mr Chan. although most lenders are likely to be
to extend the deadline for new homes to “Advisers should be telling clients helpful wherever possible in view of
be built by 28 February 2021. not to wait – if they want to take the circumstances,” says Boulger.
The announcement was made in advantage of the stamp duty savings, The new deadlines are important
August by The Ministry of Housing, they should ensure everything has been because the HTB scheme in England
Communities and Local Government, adequately submitted to lenders well will change significantly from April 7
which confirmed that the new scheme before the deadlines. For new cases, it 2021. The current scheme faced
will still commence with bookings from may be worthwhile for clients to pay allegations of driving up the value
October for completions from April 2021. more attention to developer’s estimated of new-build homes, which led to
The deadline for the legal completion of build completion date and factor that government reform. From next April,
the sale remains the 31 March 2021. into their buying decision if they have a the scheme will be limited to first-
Despite reassurances from Christopher choice of properties,” he concludes. time buyers and have regional price
Pincher, MP and housing minister, that caps, which will range from £186,100
the extra leeway “will provide certainty FALLEN THROUGH in the North East to £600,000 in
for HTB customers whose new homes According to the Home Builders London. This means developers will
have been delayed due to coronavirus”, Federation, around 18,400 sales would need to ensure any homes they build
mortgage expert Ricky Chan believes the have fallen through had the deadline adhere to the new thresholds, or
two-month allowance is not enough to not been pushed back. cease selling properties through
actually help. Ray Boulger, senior mortgage the scheme. ●
The director and Chartered financial technical manager at John Charcol,
planner at London-based IFS Wealth said advisers will now play a crucial Aamina Zafar is a freelance journalist
& Pensions, says: “On the surface the
scheme sounds like a big help, but, in
reality it does probably causes more WHAT IS HELP TO BUY?
additional problems than it solves. This is
because the two-month extension only The HTB scheme was launched in 2013 by the UK government to help people who could
relates to the build completion of the afford the mortgage repayments but could not save enough for the deposit required.
new homes and not the legal completion Under the equity loan scheme, buyers only need a 5% deposit. The government then
date of the purchase. In other words, lends up to 20%, rising to 40% in London, of the total value of the property.
the deadline for new homes to have Applicants must buy a new build home to qualify.
been finished to qualify under the HTB The loan is paid back to the government when the buyer sells the property. If they decide
scheme has now been extended to not to sell, repayments start in the sixth year at a rate of 1.75%. This rises each year, in
28 February 2021 but deadline for line with the retail price index inflation rate plus 1%.
the legal completion of the purchase Some 273,000 homes have been purchased through the scheme, with first-time buyers
remains the same – 31 March 2021. paying an average of £305,414 according to the latest statistics published in March 2020.
“Time will tell but it’s likely that
GETTY
this two-month extension would not
smp.org.uk / Mortgage Professional / Autumn 2020
MARKETS
STRIVING
FORWARD
8
thesmp.org / Mortgage Professional / Autumn 2020
MARKETS
David Thomas reflects on a challenging time to be able to demonstrate they
are committed to high standards,
for the mortgage market and highlights why professionalism and have a customer
it has never been more important for firms to centric culture. Therefore, at the
Society of Mortgage Professionals
commit to high standards and professionalism
S
(SMP) we have launched the Associate
Firm status.
ince Covid-19 hit UK at high loan-to-value lending. This Becoming an Associate Firm
shores at the beginning manifested itself in 90% of deals being publicly aligns your firm with these
of the year, the mortgage withdrawn, particularly impacting first objectives as we collectively strive to
market has been a time buyers. elevate the importance and value of
complete roller coaster Addressing these concerns, mortgage advice.
of a ride. As Britain went the government took action with With a principles-based ethos,
into lockdown in March, business the suspension of stamp duty this new status also introduces
levels were buoyant with products predominantly affecting deals of up several benefits which can help you
competitively priced, new lenders to £500,000 and this has seen an strengthen your firm’s reputation
entering (or considering entering) the immediate impact, with demand within the market. It allows your firm
market and lender competition strong. suddenly increasing – indeed we have to publicly display your membership
Within hours of lockdown, the seen a number of cases of gazumping, and show your increased commitment
purchase market effectively closed. both in London and outside. to professional standards. This can be
Valuers were prohibited from I mention London because there used to help differentiate you from
entering properties at one end and was (and perhaps still will be) thinking competitors who perhaps do not have 9
completions suspended at the other. that with the new ability to work the same level off commitment and
Some lenders put considerable effort from home, many Londoners may belief to such high standards.
into development of their desktop take the opportunity to move “into You cannot suddenly obtain large
valuations and, for lower loan-to-value the country”. To date this has not numbers of online reviews if this has
mortgages, this definitely helped, but manifested, perhaps because city life not been something you have done in
literally hundreds of mortgage brokers still has a draw for many. the past, but you can display a mark
and support staff were furloughed as While many furloughed staff of standards and professionalism
activity ground to a halt. enjoyed a warm and sunny summer, to those customers who may be
Some seven weeks later, with the I am aware that some felt very researching you online.
lifting of both valuer and completion uncomfortable – being out of their As individuals and firms, we have
restrictions, the market started to employment control and questioning the power to build confidence in our
re-emerge. By this time, lenders were whether their role would still be services and earn the trust of our
taking stock of potential issues “down there. There is no doubt that some clients; but it is only by uniting behind
the line” from a credit perspective: employers used this to weed out some a shared vision that we can influence
what are the prospects for employment “dead wood”, but some advisers have the future direction and trust of our
both nationally and by sector? How has treated this as an opportunity to move sector. Everything we do at the Society
Covid-19 affected mortgage applicants? into a self-employed network world – of Mortgage Professionals centres
Were they placed on furlough? Will they perhaps an odd decision in these very around standards, professionalism and
have a role into the future? How has that uncertain times. trust. Your support will help us achieve
affected affordability? Did they build up the recognition that our professional
short term credit over this period? Did MARKET sector deserves.
they take a mortgage holiday? So where now for the market? It does For more information about
A huge number of questions for seem that stamp duty has given an becoming an Associate Firm or
all market participants to consider impetus, albeit in the short term. If anything else the SMP can support
– lenders, advisers and, of course, we see a “second wave” of Covid-19, you with, please contact our national
borrowers. then this will inevitably have further account manager Laura Gauden:
Coupled with these considerations, impact, but uncertainty is clearly the laura.gauden@smp.org.uk
early indications from Savills were watchword for the time being. 07833 586358. ●
that house prices could fall by up to With times as uncertain as they
7.5% in the following 12 months, are, it has never been more important David Thomas is chair of the Society of
raising further lender concerns for firms providing mortgage advice Mortgage Professionals
thesmp.org / Mortgage Professional / Autumn 2020
I N T E R E ST R AT E S
B E L O W
Z E RO
What would a negative
base rate mean for the
mortgage market? asks
Simon Pearce
10
T
hough Bank of England in 2008/2009 for fear that it would make
governor, Andrew Bailey, banks less profitable. Mr Bailey has also
has stated that “we are not warned that it would be a “significant
planning to use them at operational undertaking for firms” with
the moment”, he is clear changes to computer programmes, contracts
that negative interest rates and customer communications. But
(NIR) are one of a set of tools “under Covid-19 has wrecked more havoc than the
active review” and described the latest financial crash and there has been a marked
Monetary Policy Report which looked at improvement in banks’ capital ratios
the pros and cons as “the most extensive since 2008.
assessment we have ever done.” “The evidence across Europe suggests
The report fought shy of going negative that while NIRs encourage more lending
smp.org.uk / Mortgage Professional / Autumn 2020I N T E R E ST R AT E S
they don’t necessarily lead to much now offer pretty much the same deal as
lower mortgage rates” notes Miles fixed rates because lenders are pricing
Robinson, mortgage broker Trussell’s at a higher margin over base. Most run
vice-president for sales and operations. for the life of the mortgage and the
“Cheaper mortgages? Only if we had flexible ones are priced accordingly.”
bank rates at -1.0% or more – and that Both he and Mr Boulger see little
isn’t likely,” adds Ray Boulger, senior or no impact on mortgage defaults as
mortgage technical manager at John these have more to do with lifestyle
Charcol and a member of the Bank of factors and the state of economy than
England’s Residential Property Forum. interest rates. Nor are NIRs expected
“Lender margins have come under to drive increased sales of protection
pressure. Only a big cut would make a policies. Ms O’Connor remarks that
real difference.” such sales have been rising in recent
But, adds Mr Boulger, NIRs might months “independently of what’s
encourage lenders to relax some happening in the housing market”.
lending criteria: “Slightly higher risks
would be acceptable because the ACTIVE MARKET
alternative is to lose money. After all, Mr Boulger observes that “what’s good
the Bank of England would charge for advisers is an active market”: NIRs
banks to deposit there.” might boost volumes and remortgaging
Royal London personal finance could become more attractive. But
specialist, Becky O’Connor, reports Ms O’Connor is concerned that going
that: “It feels like a very big deal for into “the uncharted territory of a
lenders given the state of the economy. negative base rate could lead to banks
They were squeezed even before the making more loan decisions on a case- 11
pandemic. The appetite is there but it by-case basis. That would make life
would depend on where harder for advisers”.
they were in terms of Mr Robinson foresees
individual profit margins. “a greater focus on
And borrowers are affordability. Borrowing
nervous too: the furlough
scheme comes to an
THE UNCHARTED might be a little cheaper
but not necessarily
end in October, as do TERRITORY OF A easier”. He does not rule
payment holidays.”
Ms O’Connor sees
NEGATIVE BASE RATE out the possibility of
some lenders increasing
NIRs leading to further COULD LEAD TO BANKS rates as their risk profiles
decoupling of base rates
and new rates available
MAKING MORE LOAN change. After all, “this
is a time when first time
on the market. “Only DECISIONS ON A CASE- buyers struggle to get a
a handful of borrowers
would end up with
BY-CASE BASIS. THAT 90% mortgage.”
It would certainly be
really good deals. And, WOULD MAKE LIFE challenging for advisers
of course, most tracker
mortgages these days
HARDER FOR ADVISERS to manage borrowers’
expectations of a
have a ‘collar’ which stops ‘mortgage bonanza’.
the lender having to cut Mr Boulger’s advice is
the rate at all,” she says. “have a good answer to
Where lower rates customers who think they
were offered, we might see slightly could get paid to take on a mortgage!”
higher arrangements or shorter terms, Mr Robinson anticipates that brokers
say two years rather than five on lower will need to show customers the whole
rate deals. NIRs would lead to attractive range of other factors that have to
rates at lower deposits disappearing come into play; and it will be about
more rapidly than they already are. much more than base rate alone. ●
“Lenders have seen the direction of
travel,” says Mr Robinson. “Trackers Simon Pearce is a freelance journalist
smp.org.uk / Mortgage Professional / Autumn 2020CYBER AND FRAUD
G
oogle recent cyber
attacks and there is a
frightening list of cyber
victims from Spanish
railway systems
to multinational
technology company Garmin
and beyond.
Since the Covid-19 pandemic started
and we almost all switched to remote
working, cyber attackers appear to
have changed their modus operandi
and have deliberately targeted small
businesses and new home workers
in particular.
All businesses, including mortgage
advisers are facing increased risk
of cyber attacks as the Covid-19
pandemic forced changes in
working patterns.
12
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smp.org.uk / Mortgage Professional / Autumn 2020CYBER AND FRAUD
Hackers saw an opportunity to target CYBER READINESS
new home workers and companies The Hiscox Cyber Readiness Report
which may not have ensured cyber 2020 advised small business owners to:
security remained in force, wherever ● Do the basics well
people were working. ● Follow a framework
Jesus Mantas, an IBM ● Don’t penny pinch
executive, has been widely ● Invest in training
quoted in the past couple 2019 compared to the last six months ● Get management involved
of weeks after he pointed of 2018. ● Build resilience
to “a 6,000% increase in Mortgage application fraud
Covid-related spam” at the occurs when either false or altered
height of the pandemic. documents are provided in support than any other age group.
The OECD warns the of a mortgage application (fraud In terms of regional breakdowns,
digital security risk is by production of a false document the West Midlands saw the highest
increasing as malicious increased by 14% and fraud by increase in fraudulent mortgage
actors take advantage of submitting altered documents applications at 43%, whereas cases
the coronavirus (Covid-19) epidemic. increased by 32%), explained Cifas. in the North East rose by a third,
Coronavirus-related scams and “Such applicants often provide false it found.
phishing campaigns are on the rise. or altered bank statements and proof One of the problems for those
The OECD suggests: of income as a way to validate their involved in the housing market is that
● Individuals and businesses income for mortgage applications,” it can attract organised gangs as well
should exercise caution when it said, adding “Interestingly, nearly as the opportunistic fraudster.
they receive coronavirus- half of those caught committing For its Global Economic Crime and
related communications and application fraud (45%) were aged Fraud survey, PwC quizzed more
use appropriate digital security between 31-40 years old, a 16% than 5,000 respondents across
“hygiene” measures (eg patching, increase compared to the last six 99 territories about their experience
use of strong and different months of 2018. They were closely of fraud in the past 24 months. The 13
passwords, regular backups, etc.). followed by those aged between 41-50 respondents reported an average
● Treat with caution all years old who saw a 6% increase.” of six fraudulent activities per year
communication related to the Coincidentally, research carried out - the most common types were
coronavirus crisis, even indirectly by Cifas and WPI Economics revealed customer fraud, cybercrime and asset
(eg teleworking tools) including that people in the 35-44 age category misappropriation. And there was a
emails, messages on social media, were more likely to think that roughly even split between frauds
links, attachments and SMS. exaggerating their income on their committed by internal and external
● Keep computers, smartphones and mortgage application was ‘reasonable’ perpetrators, at almost 40% each –
other devices up to date with recent with the rest being mostly collusion
security patches. between the two.
● Regularly back up content, The Payments Industry Intelligence
especially important data. CYBER TRENDS 2020 Fraud and Financial crime
report adds “Theft, fraud, deception,
MORTGAGE FRAUD ● The 81% of SMEs are increasingly fearful of a
cyber-attack or data breach.
corruption, money-laundering… the
But the problem for mortgage possibilities for making and moving
● 81% of UK SMEs confirmed that they had
advisers is not just about Covid-19 suffered a data breach or cyber-attack. money illicitly are seemingly vast,
and cyber-attacks. Late last year, ● Nearly 1 in 5 (17%) IT decision-makers often with low risk and high returns
Cifas produced a survey which surveyed have no cyber strategy in place. for the perpetrators. While financial
showed mortgage fraud saw a 5% ● 76% agree that they are nervous crime can be committed on a small
increase in the first six months of about moving from an on-premise scale purely by ill-intentioned
IT infrastructure to a cloud infrastructure individuals, it more often extends
due to fears of data security. to large-scale, highly organised
TOP FIVE SCAMS ● 98% of IT decision-makers in SMEs educate operations.
employees about how to identify a cyber
“These larger networks can span
Top five scams in the UK threat, with the most popular approach
being a combination of external and internal international borders, often with
1. Boiler room schemes
2. Phishing scams & smishing scams training (32%). close connections to violent crime
3. Pension liberation scams ● SMEs in the financial sector were more likely and even terrorism. Financial crime is
4. Home buying fraud to suffer 3 or 4 breaches than any other everyone’s problem.” ●
5. Freebie scams sector at 50%.
Source: FSCS Source: OGL Computer Liz Booth is contributing editor of
Mortgage Professional
smp.org.uk / Mortgage Professional / Autumn 2020C O M M U N I CAT I O N
S
ome of us will remember It has seen an astronomical increase has suddenly starting using this
the 1985 Aretha Franklin in demand during Covid-19 and if we technology. Is it a flash in the pan?
song, “Who’s Zoomin’ included all other virtual platforms Well it could have been if Covid-19
Who?” (bit.ly/31frrgi) out there, such as MS Teams, Skype had come and gone quickly – but after
Who would have and Webex, to name a few, then this six months we have got used to it –
thought it would be figure would escalate with many more and learned to use it effectively.
35-years after the song was released hundreds of millions of people. So, how does this mass change
that we would find out the answer to Who among us has not used some of how we connect alter how we
that question. face-to-face virtual platform in the communicate when advising on
The answer, according to Zoom, last few months with colleagues, mortgages and especially protection?
is 300,000,000 daily meeting friends and family? From the very Well before Covid-19, there were
participants around the world. elderly to the very young, everyone really two main ways of communicating
WHO’S
ZOOMIN’
WHO?
14
Andy Walton reflects on the huge
uptake in video meetings during
the pandemic and reveals why this
method of meeting clients might
be here to stay
smp.org.uk / Mortgage Professional / Autumn 2020C O M M U N I CAT I O N
with a customer and giving advice
– face-to-face, or over the phone.
Hardly any advisers regularly used
conference call software.
But should we? And could these
platforms replace face-to-face and/or
phone-based advice?
The answer in many cases is yes.
FACE-TO-FACE
Clearly for some time to come, face-to-
face meetings are going to be tricky. input their own figures into a back- Remember, the person arranging
So, what are the advantages of using office system – or even input directly the mortgage might not be the
video call platforms with customers into a provider site the answer to person who is motivated to look at
when you might have given advice health questions. the protection.
in person? For these reasons, some face-to- ● the adviser and customer can work
Firstly, time spent travelling is face advisers will continue using through the underwriting questions
reduced and therefore time is freed up conference call software even when much easier. What is monotonous
for both customer or adviser. Time is the time comes that face-to-face and never ending now becomes far
money and therefore this is surely a big meetings are possible again. more engaging.
advantage for everyone. Advisers could Persistency will almost certainly
see more customers in the time saved. PHONE-BASED be better as people buy people. If I
Secondly, a video call allows you to A large percentage of advice is given haven’t seen you, I can’t visualize
share your screen and show customers over the phone. Some mortgage advice you. I have only bought the product –
information that can help them begins with a face-to-face meeting, I haven’t really bought you as
understand what you are advising. but ends up with the protection being a person. 15
This could have been done face-to- advised over the phone. So when would you introduce the
face, however, it is not always easy to The advantages of advice given via a idea of video conference meetings?
show customers your screen when you video call meeting rather than over the The answer is to have an initial
are sat behind a desk – and probably phone are huge. phone call to gather some high-level
even more difficult if you are in their If you think about it, phone-based information, then explain the rest
home. To do so, you would need them advice is blind fold advice. Neither of the process is on video chat. If
sat either side of you to show them of you can see each other. It is difficult challenged, explain the benefits.
information on your screen, which to share information instantly and Our experience shows that 95%+
might not be particularly comfortable. attention spans are limited as there of customers will agree to the video
Finally, you could even allow the are no visuals. Furthermore, only call meeting.
customer to take control of the screen one person is listening to you. But
– very easy to do this during a Zoom how many customers are buying FINAL TOP TIPS
meeting – and the customer could the mortgage or protection? Very ● Practice video calls with another
often, two. colleague – it is currently unlimited
Other advantages with video calls and free to use from one computer to
include: another.
● the customer is more engaged with ● Get your settings right on the
95%+
the sales process. platform – they can help the
● the customer will spend longer on a experience.
video call than on the phone. ● Get your background right – you can
● the adviser can see and gauge have a company image, office image,
customer reactions – this is even the house they are thinking of
OUR EXPERIENCE SHOWS THAT especially important with buying as the image behind you.
95%+ OF CUSTOMERS WILL protection advice as it is in part an
emotional purchase.
● Get permission to record your video
call meeting and review how you
AGREE TO A ZOOM MEETING ● the adviser can show the customer came across.
graphics, sales aids, data, provider So, “who’s zoomin’ who?” The
information instantly and answer is – we all should be. ●
get feedback.
● the adviser can talk to both Andy Walton is protection proposition
customers at the same time. director at Mortgage Advice Bureau
smp.org.uk / Mortgage Professional / Autumn 2020C hartered Insuranc e Institute 21 Lo mbard Street, Lo ndo n, E C3V 9AH cii.co.uk
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