Home Truths with Lottie Dougill, Gatehouse Bank
This article was originally published by Iress.
What’s exciting you most about the UK mortgage market right now?
It’s encouraging to see the growth of alternative finance types as customers look beyond conventional financial providers to find the best fit for their specific needs. This is providing an increase in healthy competition within the market and placing the power with customers, making this an exciting time for product innovation and more specialised service options.
As we are seeing at Gatehouse Bank, many are attracted by organisations who are offering a wider and more innovative product offering than has previously been available. This can be especially helpful for customers with more complex cases or who have more niche requirements, as well as those residing overseas.
Where do you see the biggest opportunities for brokers and intermediaries in the next 12 months?
With ESG considerations becoming increasingly important, the rise of ethical finance will continue to pose a big opportunity in the next year and beyond. As a Shariah-compliant Bank which sees being a responsible and sustainable provider as the guiding principle behind our operations, this is something we are particularly interested in.
For consumers, there is considerable demand for ethical and sustainable financial products, with Islamic finance providing a credible alternative to conventional forms of finance. This is evidenced by our Islamic and Ethical Finance Consumer Report, where over half (55%) of Muslims said they would pay a higher rate for a green finance product.
Previous research we conducted also highlights this desire within the home finance sector specifically, where almost half (45%) of UK homebuyers would consider using an ethical finance provider that follows Islamic principles.
It will become increasingly important for brokers to have an understanding of alternative finance types which are more ethical in nature, such as Shariah-compliant finance, to ensure they are best able to serve the changing needs of customers and take advantage of the wealth of opportunities this is likely to offer.
What’s one industry challenge that you think doesn’t get talked about enough?
At Gatehouse Bank, we work with many brokers and customers who are based overseas and the lack of standardised global compliance frameworks in place, which includes the documentation required to secure finance, can be a challenge in some cases.
We know that our BDMs have the knowledge and expertise to provide guidance on this and ensure the process of securing the home finance required is as smooth as possible, but the lack of standardisation is confusing to some, especially if it is a complex income case that may require a more nuanced approach.
If you could wave a magic wand and change one thing about the mortgage process, what would it be?
While it is so important for all the necessary legal checks and compliance procedures to be carried out, especially when it comes to anti-fraud measures, the current process for doing these can often delay completions by weeks or months.
I would like to see an automated, more standardised approach introduced. This would be effective in reducing turnaround times, enabling providers to release funds quicker and, most importantly, improve customer satisfaction.
What drives you personally in this industry? What keeps you motivated?
It is incredibly rewarding to help people become homeowners and to create solutions for brokers which ultimately help their customers to achieve their goals too. Strong professional relationships built on trust are key within this industry and I thrive on creating strategic partnerships that will benefit all involved, including customers, developers and brokers.
How do you see collaboration shaping the future of the mortgage space?
An environment which encourages global collaboration between UK providers like Gatehouse Bank and overseas introducers and developers is a key driver for future growth. With many UK expats and international residents seeking to invest in the UK property market, it is only through working closely with overseas partners that we can enable and support them to achieve their property ownership goals.
Technology has made an enormous difference to the intermediary journey – where do you see the biggest gains still to be made?
The introduction of collaborative data models between UK and overseas credit reference agencies would be a game changer. This would do a great deal to support international customers, particularly in complex income cases.
How does Iress fit into your strategy, and how do our tools and partnership help you deliver better for your customers?
As the industry, and the financial services sector as a whole, moves further toward digital transformation, having a robust technology partner is a key factor in being able to deliver our product proposition. It allows us to enhance broker connectivity and widen distribution which, ultimately, supports our strategic growth.
What does success look like for you – and for the industry – over the next five years?
The Islamic finance sector has been rising in popularity as an alternative finance type over the last few years, resulting in it becoming one of the fastest growing sectors in financial services globally. While it is great to see more people looking outside of conventional finance for the products and services that best suit their needs, more can be done to help this sector reach its full potential.
Success for me, will involve providers of Islamic finance and brokers working together to increase knowledge and awareness of the options available to those seeking Islamic property finance while also working to remove barriers and lingering misconceptions which may be holding people back from seeing it as a viable option.
An enhanced familiarity with Islamic finance will not only help brokers to cater to the diverse nature of the UK market, which includes four million Muslims but will also encourage further investment from international investors seeking property within the UK.
Finally, if you could give one piece of advice to intermediaries navigating today’s market, what would it be?
Building on what I’ve already said, I would encourage brokers and intermediaries to embrace the potential of alternative property finance types, including Islamic finance, through increasing their knowledge of the key differences and how to offer it as a viable option to their clients.
At Gatehouse Bank, our Business Development Managers offer training and development dedicated to ensuring that different ways of financing home ownership and investment properties are not overlooked and we are happy to support anyone who may want to learn more about how the sector.
As the home finance market continues to change and develop, having an understanding of alternative finance will help intermediaries to tap into new markets and continue to provide the best service to their clients.