Mark Whitear, director of commercial development at Foundation Home Loans speaks to The Intermediary about how specialist lending serves the needs of non-vanilla customers, the challenges faced in a rising-rate environment and how the firm mantains its strong service levels.
You were recently made director of commercial development at Foundation Home Loans. Can you tell us about the new role and what it means within the wider management team?
The new role encompasses quite a variety of responsibilities across the front end of the business. As the title suggests part of my remit is to look at new opportunities for Foundation but I am also responsible for the marketing function as well as our Broker Management and onboarding, and the management and use of our CRM systems to enable the sales teams to have clear records of all of our interactions with our intermediary partners.
Foundation offers both specialist buy-to-let and specialist residential mortgages. What is the thinking behind such a strategy and what are your views on future growth for the specialist market?
The original focus upon our return to lending in 2015 was focused on the specialist buy-to-let sector. It was always the intention of Foundation to operate in both buy-to-let and owner-occupier markets. Following a period of establishing ourselves in the buy-to-let sector we broadened the proposition into specialist owner-occupied.
The specialist residential world is less well-served than some other markets and it is a key growth area of the business, and we offer brokers and their clients sensible well thought through solutions for the more complex needs of borrowers.
The growth of the specialist lending market continues at pace as customers’ lifestyles no longer meet the traditional vanilla view of the high street. As we see the growth of the self-employed market, borrowers with multiple incomes or those earning high commissions and bonus, we are the lenders best placed to understand these circumstances and offer the manual underwriting to assess their circumstances and provide the right solutions.
We are now half-way through 2022. How would you review the first six months and what are your thoughts on how the mortgage market might play out in the rest of the year, particularly from an adviser perspective?
Well, it has certainly been an interesting start to the year not only in the world of mortgages but also in wider economic terms. From a lending perspective the market has remained buoyant, and we have yet to see any real decline in demand and house price growth has continued.
This was heralded as the year of the remortgage, certainly in the world of buy-to-let, so there should still be plenty of opportunities for advisers to help their clients.
In this rising rate environment, the challenges will be in sourcing product at the right time for clients and managing both their expectations in terms of rate and the tightening timescales associated with securing products.
Service levels and securing resource to service business are major issues in the lending space. What is Foundation doing to ensure you maintain strong service levels and how have you found securing enough human resource to do this a problem?
Having already adopted a more flexible approach to resourcing even before the pandemic, we were already well-placed and confident this model was the best way for us to continue to deliver great results for our clients by being able to recruit the best staff from across the UK, wherever they were located. Our service levels have remained fairly consistent this year and we have the ability to flex with demands to ensure we maintain a good service for intermediary partners.
Boris Johnson recently announced a series of measures around the housing and mortgage markets. What was your takeaway from this, particularly the announcement of a new independent review into the mortgage market?
Its very hard to tell at this point exactly what this might mean for lenders, advisers and their clients. I think we will have to wait further details before we can draw any significant conclusions as to what the outcomes, positive or negative may be.
There is always a lot of talk about the capital markets/swap rates, etc. What is Foundation’s position in terms of funding going forward and are you looking to expand into other product sectors in the future?
Swap rates have certainly seen some significant increases over the last 12 months that are driving the costs of fixed-rate mortgages upwards but we are well placed to continue providing products to our intermediary partners through these more difficult times.
Plus, we will be looking at a number of proposition enhancements to further aid brokers over the remainder of the year. There are currently no plans for us to enter adjacent markets.
