Each week Mortgage Solutions and its sister title Specialist Lending Solutions select the most thoughtful or thought-provoking comments from our readers.
This week’s Star Letter came from Robert Drury and his response to: Time to cut down off-putting mortgage industry jargon and keep it simple – Bamford.
It’s refreshing to see an article that talks about what I’ve been a huge advocate of for years.
The need to ‘keep things simple’ has always been important to me when talking to my clients, and even more so now as I am new to the brokering community but with 18 years’ experience as a mortgage adviser working for high street lenders.
Much as regulation is vitally important to our business, we need to be mindful of our customers’ needs and requirements.
Many a time I have sat down with a customer who has brought in piles of mortgage paperwork, sat in front of me and in answer to my opening line: ‘Tell me about your mortgage’. They can’t.
They don’t know what their original KFI (Key Facts Illustration) tells them about their ERC (early repayment charge), if they had an HLC (higher lending charge), what their original LTV (loan to value) was, what their new APR (annual percentage rate) is and what the FCA (Financial Conduct Authority) and FOS (Financial Ombudsman Service) can do for them.
Let me put it another way. I always take my car to the same local garage I’ve been going to for years.
They give me great service, M.O.T. my car and service it on a regular basis.
If something needs mending, they explain it to me in language I understand: ‘Robert, if I don’t mend this you won’t be able to steer properly when you turn right around the roundabout’. I understand the issue and trust my garage to do the job.
It should be the same with people’s largest financial transaction. I think like this: ‘If my clients were to be interviewed a month after coming in to see me about their mortgage, what would they probably remember?
That they had borrowed a large amount of money over a long period of time, that they were going to have to pay a certain amount of money every month for a certain length of time, and then maybe what they would incur as a penalty if they were fortunate enough to win the lottery and repay their mortgage in full.
Even at this basic level I believe more customers would be in a better-informed position than they are at present.
Finally, as with me and my garage man, if we speak plain, simple English to our clients then they will trust us and will be able to tell me about their mortgage in the future.
I agree – the time to speak simply is now.