Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Solutions. Read the original article for full details.
Mortgage distribution's future is about choice, not channels – Spencer
Melanie Spencer, growth director at Target Group, has argued that the future of UK mortgage distribution is about giving customers greater choice rather than debating whether the market should be direct or intermediated. Writing in Mortgage Solutions, she says the UK has built one of the strongest intermediary distribution models in financial services, with advisers playing a crucial role in helping customers in an increasingly complex market.
Evolving customer journeys
Spencer says the debate around distribution is too binary: digital versus human, lender versus broker, direct versus intermediated. In reality, the modern customer journey is unlikely to fit neatly into one channel. Customers may research online before speaking with an adviser, engage with their bank through an app, complete parts of the journey digitally and then seek human support for complex decisions. Once a mortgage is in place, they may prefer digital self-service for some interactions while expecting access to advice when circumstances change or at remortgage time.
She notes there is little evidence that customers value advice any less today than a decade ago, but expectations are evolving, technology is developing rapidly and lenders face pressure to become more efficient while delivering more personalised experiences.
Technology supporting advice
Spencer argues that technology does not have to diminish the value of advice. Used well, it can enhance it by reducing burden and repetitive processes, freeing advisers to focus on areas where human expertise adds the most value. She says this could become increasingly important as customer acquisition and retention grow more competitive.
Data as the real advantage
Underpinning this is data. Spencer says the mortgage industry holds huge amounts of information, but simply possessing data does not create a competitive advantage. The real opportunity lies in connecting it, understanding it and acting on it. She highlights the Financial Conduct Authority's emphasis on this, particularly regarding customer vulnerability and Consumer Duty: firms must demonstrate they understand what their data is telling them and act upon it.
For lenders, better use of data can support more personalised propositions, improve servicing, enable earlier intervention and help firms understand how different customers want to interact with them. For advisers, better-connected data and technology can remove friction points from the advice journey. Less time searching for information, rekeying data or managing automatable processes means more time focusing on customer needs.
Spencer concludes that the industry's next competitive advantage will come from how effectively firms use their data, rather than the volume they hold.
Relevance for letting agents and inventory clerks: while the piece focuses on mortgage distribution, its themes of evolving customer expectations, digital-first journeys paired with human advice, and Consumer Duty-driven data use reflect wider shifts across UK property services.
Source: Mortgage Solutions