Let’s step into 2022 with confidence says Jon Cooper, head of mortgage distribution at Aldermore


We’re feeling positive about the new year and ready for any new challenges, says Jon Cooper, head of mortgage distribution at Aldermore

A year ago, we were looking forward to a post-pandemic world with the arrival of vaccinations.

2021 didn’t quite pan out as we all hoped but, for large portions of the year, life was beginning to get back to normal.

As restrictions eased in our social and working lives, the same positivity was reflected in the mortgage market, with lenders beginning to return to pre-pandemic lending criteria.

Back to growth

At Aldermore we resumed our growth plan in 2021. We reinvigorated our product range, returned to core parts of the mortgage market and grew our risk appetite. For example:

  • We were the first specialist lender to return to high LTV lending with 90% and 95% LTV mortgages.
  • We moved back to our pre-pandemic lending policy, including enhanced income multiples up to 5.5x and a near-prime product range for those with less than perfect credit.
  • We returned to specialist buy-to-let lending with an extensive product range for all types of landlords, up to 80% LTV, with no limits on the number of properties in the background portfolio.
  • We reduced our overall app-to-offer turnaround time by 40% year-on-year.
  • We resumed capital raising in October and raised our limits back to pre-covid levels.
  • We invested in API technology to help brokers directly submit cases to us without rekeying.

We also kept a focus on supporting existing borrowers, including those in financial difficulty. But our mortgage book has been extraordinarily resilient, and few have needed further help after the targeted care we gave in 2020.

Supporting product switches

One of our most successful achievements in 2021 was the launch of our dedicated broker switch portal in February. 

The product transfer process can be done in six easy steps, with no fees, credit checks or ERCs to pay if your client switches to a new product within three months of their renewal date. 

Plus, we’ll give you a heads up around four months before your client’s rate is ending, with their original application reference number, name and renewal date.

Borrower insight

We’ve continued to listen to homebuyers, landlords and aspiring first-time buyers to gain an insight into their needs, experiences and feelings about the mortgage and buying process.

Our surveys last year revealed 72% of aspiring first-time buyers thought buying a home was unachievable for them, and 34% of the self-employed believe it will be harder to get a mortgage because of covid.

These insights, garnered from regular surveys and focus groups, helped inform the expansion of our product ranges alongside our more flexible lending strategy.

Looking ahead

Covid remains a huge challenge and of course the Omicron variant makes it difficult to make predictions about the market.

But what we can be certain of is that we’ve been here before, and we adapted. We are better prepared to face remote working, restrictions or lockdown, because we don’t need to start again from scratch.

In the longer term, we have to learn to live alongside COVID and it’s likely we’ll continue to see our lives and work disrupted periodically.

Understanding how clients are impacted by this will be vital and specialist lenders will play a key role in helping those excluded from the high street.

From first-time buyers with limited deposits to the self-employed and those with less than perfect credit, many clients could find it harder to get a mainstream mortgage.

We don’t believe that anyone should be automatically restricted from borrowing just because they don’t meet a strict set of tick-box criteria. That’s why our experienced underwriters are empowered to use their discretion to make a considered judgement if your client has unusual circumstances or non-standard income. And it’s why we design our products to support lending decisions where they make sense.

The green revolution

One prediction we can make is that green mortgages are set to be a major focal point in the mortgage market this year.

Minimum EPC standards could affect all homebuyers and existing homeowners eventually, but landlords are the first to be impacted. Privately rented properties will need to be brought up to an EPC level C or higher by 2025 for new tenancies and by 2028 for all tenancies.

This will require many landlords to make improvements to their properties and gives brokers an opportunity to get in touch now. Find out if they understand the challenges they’re facing, the potential costs, and how additional borrowing could help them fund any work.

Ready for the challenge

At Aldermore we reignited our business in 2021 and have moved confidently into 2022.

Whatever the challenges it brings, we’re ready to support brokers and clients with specialist lending solutions every step of the way.

For Intermediary use only.