Innovation and efficiency in the mortgage market conference 2017.

1. Innovation and efficiency in the
mortgage market conference 2017
iress.com

2. iress.com 2
Mortgage Efficiency Survey 2017
Background
• 21 lenders
• 2016 gross lending of circa £129bn
• Over 52% market share
• High street names, regional building societies, specialist lenders & new entrants
Atom Bank; Bank of Ireland Mortgages UK; Birmingham Midshires; Cambridge Building Society;
Clydesdale Bank PLC; Coventry Building Society; Family Building Society; Hinckley & Rugby Building
Society; Leeds Building Society; Leek United Building Society; Lloyds Banking Group; Market
Harborough Building Society; Newcastle Building Society; OneSavings Bank; Principality Building
Society; Royal Bank of Scotland Group; Santander; Tesco Bank; Vida Homeloans; West Brom;
Yorkshire Building Society

3. iress.com 3
Mortgage Efficiency Survey 2017
What did we find out?
Market overview
• Buy to Let – sales only dipped by 3%, but next year?
• Re-mortgage market grew – 11% year on year
• Offers made in ten days or less increased by over 12% to nearly a third (30.8%)
• Instant and offers in less than five days remains low (5.3%)
• The intermediary channel is still King - 80% on average in the survey
• 75% of lenders saw an increase in intermediary applications
• And the same number expect volumes to remain level this year

4. iress.com 4
Mortgage Efficiency Survey 2017
What did we find out?
Direct v’s intermediary business
• Similar average DiP accepts 49.5%, declines 16%, refers 34.5%
• Sales to offer - direct 1.5% higher at 81.5%
• Offers to completion both 85%

5. iress.com 5
Mortgage Efficiency Survey 2017
What did we find out?
Direct v intermediary business : 2015-2017
IFA Declines
24%
16%
IFA & Direct Refers
34.2%
23%
IFA Accepts Direct
54%
49.1%
65%
49.5%
MMR levelling the market?

6. iress.com 6
Mortgage Efficiency Survey 2017
What did we find out?
Going social - is 140 characters useful?
• Intermediary engagement – 53% LinkedIn, 63% Twitter
• Consumer engagement – 47% Facebook, 58% Twitter
• YouTube and Instagram also gaining traction
61%
28%
11%
Importance of social media
Somewhat important Very important Vital
39%

7. iress.com 7
Mortgage Efficiency Survey 2017
What did we find out?
Going digital - Mobile, Robo-advice, Digital broker, AI, Chatbot, Gen-D
• Mobile a given for lenders, 80% affordability, 66% DiP and over half FMA & case tracking
• 50% offer or about to offer digital self-service mortgages, aimed at re-mortgage market
• Robo-advice & millennials
• 41% use an app to buy a mortgage, 1 in 4 happy or very happy online AI robo-advice1
• 1 in 5 brokers set to launch a robo-advice proposition, cost & time savings2
• Would you trust a robot to ….3
• …give mortgage advice?
• …set you up on a date?
1 EDM research; 2 Panacea adviser research; 3 HSBC Trust in Technology
11%
11%

8. iress.com 8
Mortgage Efficiency Survey 2017
What did we find out?
Going digital – the Canadian way
• 3 reasons why 95% of Canadians will turn to robo-advice/chatbots for mortgage advice1
• Chatbots provide instant answers
• Automatically source the best deals
• More accurate and faster than any mortgage banker or broker
• The tipping point will be when the quality/objectivity is proven
• Alterna bank already live with a digital end to end mortgage platform2
• Pre-approved in 10 to 15 minutes, no paper, no conversations
• Will robo-advisers some day surpass humans for delivering one-on-one mortgage advice?
1 The Globe and Mail; 2 BNN Business News Network