Borrowers   |   Introducers

Lender Legends · Why Go West In 2024

Being thoroughly lovely and with over two decades in the financial sector, West One Loans’ Managing Director for Residential Mortgages and Second Charge Mortgages, Marie Grundy, was the easy choice when picking an industry leader to get insider insights into the current second charge landscape.

Ever happy to offer her expertise and support, Marie has worked closely with the TLP team for several years now and is a firm favourite for helping with our more complex second charge cases

Now in her 8th year with the specialist lender, we thought it was the perfect time to pick her brains on all things second charge and how West One could be the lender to help your clients in 2024.

West One Loans Marie Grundy

“Take the time to enjoy the little things, as one day you might look back and realise they were the big things.” ― Robert Brault

A very warm welcome Marie, we’ve got just 6 quick questions for you, so let’s get started…

  • Focusing on the second charge sector, what trends do you foresee in 2024?

Already there are very early signs that 2024 is going to be a very strong year for the second charge market.  There’s a culmination of reasons for this. 

Firstly according to UK Finance, there was £219bn of product transfers in 2023, up 11% compared to the previous year and for context was almost as big as all remortgage and purchase activity combined.  Product transfers are effective where it is a like for like remortgage, but if borrowers need to raise capital during the fixed rate term, a second charge mortgage is becoming an increasingly popular option for borrowers, which allows them to raise capital without disturbing their existing mortgage arrangements. 

Secondly, there is still a huge misconception that second charges are only for borrowers with more complex circumstances.  The vast majority of our borrowers have high street mortgages with good to excellent credit scores.  They may still be benefiting from preferential mortgage rates, or want to protect an interest only mortgage, which is why second charges are often the most appropriate product choice for borrowers with additional borrowing needs.  

Thirdly, in 2023 ONS reported that 1.4m households faced increased mortgage costs and there are a further expected 2.4m mortgage deals coming to an end in 2024.  For these households the impact of increased mortgage payments combined with an increased cost of living means that a number of homeowners are looking for ways to offset mortgage payment shocks by reducing their outgoings.  Debt Consolidation is one way of achieving this provided that the advice is appropriate and customers fully understand the pros and cons of converting unsecured debt into a mortgage.  In the right circumstances, this can be an appropriate solution and debts are generally discharged directly from the second charge mortgage proceeds which allows lenders to exclude these debts from affordability assessments. 

  • Why do you think second charges can be so beneficial for some borrowers, compared to other forms of finance.

Second Charges do generally offer a greater degree of flexibility, whether that is speed, loan size or loan purpose.
Unlike a remortgage there isn’t any conveyancing required which means that the process of completing a second charge can be far quicker than a remortgage. There is sometimes also the opportunity to use desktop valuations which can really have a positive impact on application turnaround times which is particularly helpful where speed is of the essence.

If you have borrowers in need of a larger loan, second charge lenders offer mortgages up to around £1m, this is helpful for higher net worth borrowers who are looking to raise sizeable loans which might be for example to purchase a second home, investment property or to complete a high end home improvement project.

The Loan Partnership business partners
  • How does West One strive to remove hurdles for both introducers and borrowers in the application process?

We work closely with a limited number of distribution partners, including The Loan Partnership,  who are really experienced in advising and arranging second charges offering market expertise to ensure the client is placed with the most appropriate lender based on their needs and circumstances.  This really helps to improve the customer journey, as the firms we work with understand our processes and underwriting requirements which really helps to speed up the offer process.

The Loan Partnership specialise in working with mortgage intermediary firms so they really  understand the value and importance of the client/broker relationship.

We constantly review our processes, criteria and products to make sure that the customer journey is as streamlined as possible but one of the most powerful services we offer is the ability to refer cases which fall outside of our published criteria.  

This enables us to fully consider the client’s full circumstances, and look at each case individually to establish if we can find an appropriate lending solution.  This is sometimes a lifeline for borrowers with more complex borrowing needs.

 

The Loan Partnership Introducer Support
  • What challenges do you currently observe in most second charge applications that introducers should be aware of?

Quite often we see a disconnect between a borrower’s perception of what their property is worth and the valuation figure arrived at by a qualified surveyor. This has been heightened over recent months, where there has been a cooling off in the housing market, which has fed into property valuations.

So my advice would be to be realistic around property values, carrying out some additional research can be invaluable in ensuring that customers expectations can be managed accordingly.

 

  • Why, in your opinion, should clients consider West One in 2024, and what sets you apart from other lenders?

At West One we really strive to offer a second charge proposition with a broad reach to meet the needs of a wider group of borrowers.  We are always trying to bring innovative products and solutions to the market, as an example of this we were the first lender to introduce green second charge mortgages , introduced criteria to support bank of mum and dad transactions and developed an Interest Only product targeting higher earning borrowers looking to borrow loans of £100,000 and above.  

We don’t rely on credit scoring, which means we can apply an individual approach to the assessment of second charge applications which offers significant benefits for borrowers. 

Our criteria also serves the self employed community well, where we can consider self employed borrowers with a minimum of 1 year’s trading and rely on SA302s as income proof backed by underwriting expertise which can be invaluable in arriving at the right solutions for self employed customers. 

We don’t want to stop here though, we will keep looking at ways to evolve our product range to meet the needs of our customers. 

  • Can you share any existing or upcoming initiatives that you think introducers should be aware of in 2024?

We are heavily focusing on creating more streamlined processes to create a more efficient customer journey which we are working on behind the scenes as we speak. 

In addition to this we have some ideas around the further development of our residential and buy to let second charge ranges, so watch this space!

 

The Loan Partnership mortgage packaging for brokers
  • Thanks Marie, enough about business, we would like to know what Marie gets up to when she’s not working at West One and wowing clients

I am a big Leeds United fan, and try to get to as many games as possible with my son as well as  often exchanging emails with Rob from The Loan Partnership (a fellow Leeds fan)  on the highs and lows of our performance. 

I have also recently moved into a more rural location and inherited a family of owls, which has developed into a real interest in birds and  the surrounding wildlife.  I never thought I would have been so excited to receive a pair of binoculars for Christmas!!

Thanks so much for your time and thoughts Marie, your wealth of knowledge and enjoyable conversations have made West One a key collaborator for us over the past few years and we look forward to seeing how the second charge sector further adapts over the next year. 

To discuss if West One is the right fit for your current cases, you can chat with one of the team by calling or getting in touch right here