Jessica Bird speaks with Jonathan Stinton about keeping up a human touch in an ever-evolving market.
From his experience starting out with Coventry Building Society as a business development manager (BDM) 15 years ago during its launch into Northern Ireland, to his move into corporate accounts and on into a head of sales role, Jonathan Stinton, now head of intermediary relationships, has seen all sides of this business.
In addition to his time at Coventry dealing with everyone from BDMs to brokers, support and operations teams to networks, Stinton started out his career as a mortgage broker himself.
A strong place in the market
Like many in this industry, Stinton’s first foray into the property finance market – initially on the broker side – was serendipitous rather than planned. What became apparent as time went on, however, was a growing interest in the BDM side of the business.
“I’d always been interested in that part of the market, and then the opportunity came around and it was too good to be true,” he says.
“Obviously there’s more freedom when it comes to being a self-employed broker, but moving to BDM gave me a more rounded view of what the mortgage world was all about. It helped me appreciate what lenders are doing to try and support brokers as well.
“It gave me a really good perspective from both sides, and I definitely picked up benefits from being on both sides of the fence.”
Coventry was an obvious choice for this move. Stinton explains that this is the second biggest building society in the UK, and the eighth largest lender overall. In 2023, it was also the first building society to obtain B Corp status – denoting high standards of social and environmental performance, transparency and accountability.
“Building societies are really important,” Stinton says. “We are lending our own members’ money, so we want to do that responsibly and prudently.
“Clearly with a firm of our size, which has almost £49bn worth of mortgage balances, we are a major player in the marketplace.”
Stinton goes on to describe the ethos of the business as centring on a “service is king” approach.
“We want to answer your calls and we will answer them quickly,” Stinton explains. “Our average call wait this year is 42 seconds. When you think about some of the turbulent times we’ve been through, we are really proud of that.”
This goes beyond just speed, he adds: “We want to spend as much time as needed with brokers to give them the answers. If we can help facilitate that direction on the first occasion, it saves phone calls further down the line.”
Lending under pressure
Originally founded in 1884, it is safe to say that Coventry Building Society has been around for many market fluctuations, challenges, and turbulent times. Most recently, it has weathered the storms surrounding the Covid-19 pandemic, international uncertainty, and economic turmoil, all while remaining focused on service as a key priority.
“There’s a combination of different factors,” says Stinton. “we like to watch, listen and respond to what’s going on in the marketplace. It’s really important for us to watch what’s happening with things like swap rates, competitor moves, house prices, unemployment – the general outlook. We want to listen to brokers and our distribution partners, as well, to understand what their challenges are, and where they see opportunities, and then we respond accordingly.
“We’re a member-focused organisation. Generating the maximum profit is not our goal – we want to generate a good return for our members’ money, so that we can then reinvest into other propositions. That’s really important.”
He adds that part of the building society’s longevity and service comes from the importance ascribed to values and purpose – which fed into its recent attainment of B Corp status.
“We want to make sure that we can create opportunities that are going to be beneficial for us and for our future members,” Stinton explains.
One of the big conversations during the most recent turbulence – namely the rapid pulling and raising of rates by lenders in the face of growing inflation and uncertainty – has been around minimum service levels. Most notably, lenders have been called upon to pledge at least 24 hours’ notice when making product changes.
For Coventry Building Society, which has had a 48-hour pledge in place for more than 16 years, this is an important conversation to be having. However, Stinton points out while the building society stands by these commitments, they can cause difficulties, and there is certainly a balance to be struck between providing a fair environment for brokers, and protecting members’ interests.
“We will aim to give brokers two days’ notice whenever we’re withdrawing products, and that works both ways, whether increasing or decreasing rates,” he says. “There’s definitely more focus being shone on brokers’ requirements in this area at the moment.
“I can’t speak on behalf of other lenders, but from our point of view, it’s difficult to manage. We are able to manage that – we factor that into our decisions – but I can understand some of the challenges that other lenders face because of it.
“In turbulent times, things are put under pressure. For example, we occasionally get more business than we were banking on because of our 48-hour notice commitment, if other lenders are pulling products quickly.”
For Coventry, the need for notice periods is factored into all decisions made around products. It also means the business must work to constantly maintain a clear understanding of where it stands in the market, and a forward-looking perspective as to the potential effects of product changes.
Market advancements
As a building society, there is a significant focus on the human touch, and personal relationships. However, the mortgage market is evolving at pace, so where does Coventry stand on the constantly changing influence of technology in this sector?
For Stinton, there is a balance to be struck between embracing advancement, and understanding the importance of human input. For example, while the building society does offer a web chat service, it’s still human experts sitting the other end, personally responding to broker queries.
“It’s being talked about everywhere, the role of [artificial intelligence (AI)],” he says. “We think tech is there to improve things, it’s not there to replace common sense.
“When we launched our web chat service, we made a conscious decision not to go down the bot route. Brokers contact us because they want to discuss or go through the criteria on a difficult case, or a case that’s got a wrinkle in it. It’s very difficult for AI to replace a human being in that instance.
“We want to spend as much time as needed with brokers to try and answer their questions first time, as well as knowledgeably and efficiently.
“While tech is going to be good to speed up processes, we don’t think there’s going to be a replacement for a human being at this stage.”
As a result of this approach, Stinton points out that Coventry’s net promoter score (NPS) with intermediaries is +83.
While times are changing and tech advancing rapidly, to the extent that some have argued certain cases might be handled entirely by AI in the near future, Stinton says this would only be relevant for the simplest, most straightforward deals.
Indeed, he adds: “It’s human nature to want to have a personal connection and personal affirmation. It’s great to be able to chat to a human expert, get their name and have confidence that what you’ve been told is correct – there’s accountability there, which breeds more confidence in the proposition.
“I would also say that in 23 years in this business, I don’t think I’ve ever seen an entirely ‘straightforward’ case – there’s always a wrinkle in some shape or form, and certainly now.
“There’s creativity behind trying to find solutions, as well.”
This does not mean that Coventry Building Society is taking a luddite approach. Instead, it is about deploying tech – and yes, even AI – where it is most valuable.
“We think our approach is the best way forward to help brokers and their clients, but AI will become more important from a back office point of view,” he explains.
“If it can speed up efficiencies that way, then we’ll look to leverage some of those opportunities. It’s there to enhance, not replace.”
A wider look at the market
Aside from the advancements being made in mortgage tech, there are various trends taking up the headlines at the moment. One of these is the ongoing debate around Stamp Duty, and whether the tax is due for reform. Various ‘holiday’ initiatives brought in during Covid-19, followed by the nil rate threshold increase and first-time buyers relief introduced in 2022, have sparked conversations as to whether the entire system is in need of overhaul. Coventry Building Society has been at the centre of this debate.
For Stinton, the housing market needs movement, but Stamp Duty often serves as a deterrent, especially to those looking to downsize, who themselves play a vital role in freeing up stock for first-timers and next-steppers.
“We all know we have to live with Stamp Duty as an additional cost that has to be borne,” he says. “But there are lots of people in this market who are being deterred from downsizing because of the additional costs they’re going to have to bear. Is there a way the Government can actually incentivise and help people on that journey.”
Stinton goes a step further than this, and even suggests that the Government could find ways of using Stamp Duty relief as a way of incentivising the move towards net zero and energy efficiency.
“We could use Stamp Duty as a mechanism to get people to make green enhancements to their properties, and to drive that change,” he says.
This is part of a wider green picture, which is only rising in importance, even as the market grapples with arguably more imminent issues such as rising inflation. There is a push now to focus on creating real, fit-for-purpose green products that create real change.
This is particularly affecting landlords, of course. Coventry, through its brand Godiva Mortgages, is highly active in the buy-to-let (BTL) space, dealing with traditional landlords, rather than limited companies or special purpose vehicles.
“Everyone knows that building stock needs to improve, but it’s very difficult to encourage clients to spend significant amounts of money on their properties when we’re in the middle of a cost-of-living crisis,” Stinton warns.
“I don’t think lenders and providers are intentionally trying to ‘greenwash’, but I think we’re at the very beginning of a journey. As time goes on, more and more products will evolve.
“The challenge is that there is a massive education gap. We want to do better for the environment, but how? What are the different solutions available? As a lender, it’s about creating propositions that are going to be fit for purpose, but more importantly, it’s about educating brokers so they can educate their clients, on what to do and why to do it.”
Future trends
Looking ahead, one area in which Coventry Building Society is gearing up for growing interest is offset mortgages. These have become a topic of conversation more recently, due to the opportunity they provide to lower interest payments depending on a borrower’s level of savings, which is of course more appealing in times of economic difficulty. However, they have been part of Coventry’s repertoire for some time.
“In a low interest rate environment, the benefits that offset can provide aren’t as obvious as they are in a higher interest rate environment,” Stinton explains.
“We see savings rates going up, and if you mirror that against a mortgage rate, there can be more benefit in having your savings linked to your mortgage account.
“It comes back down to education, because of the intricacies, but it’s an amazing opportunity for clients to save money, save interest, and save time on their mortgage. It’s a great opportunity for brokers to forge a stronger relationship with their clients, as well.”
For these reasons, one of Coventry’s plans for the year ahead is to get out and talk in the market about offset mortgages. Not every lender offers this product, so education among brokers is particularly important.
Stinton adds: “We’ve always been a major offset player, and this is becoming a bigger and bigger part of the market.”
Other plans for the firm include continuing growing its focus on first-time buyers, further exploring the new-build market, keeping an eye on the ever-evolving worlds of both BTL and residential mortgages, and continuing its consistent trajectory of growth, built over many decades.
Coventry also has the imminent launch of its own mortgage sales and orientation (MSO) platform, which Stinton says will drive efficiency.
“This is part of our investment in our capability to help brokers,” he explains.
“Brokers need to stay front and centre, because the service they provide is so valuable, and people could be distracted with everything else that’s going on in the market.”
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