Broker explains how he approaches turned-down cases and why around 80% of clients who come to him declined still find a route through
A mortgage decline from a high street lender is not a reliable guide to whether a client can actually get a mortgage, it is simply a signal that something about the application did not suit that particular lender at that particular moment.
Jack Stevenson (pictured top), branch manager and senior mortgage and protection broker at The Mortgage Library, told Mortgage Introducer his instinct when a client arrives having already been turned down is confidence, not caution. The client sees a closed door, but he sees a single lender with a system that found a reason to decline.
"I'm exceptionally confident when I get someone come in and they say I've been declined already," Stevenson said. "From my perspective, it doesn't give me any indication that they're not going to be able to get a mortgage. I'm looking at it as something's happened to trigger that one particular lender to not like their case. Chances are if I'm using 100 different banks, there is going to be a lender out there for you."
What a decline actually tells a broker
The first step, Stevenson said, is to understand what triggered the refusal. The reasons can be straightforward – adverse credit, deposit amounts recorded incorrectly on the initial application – and the solution correspondingly simple. He described cases where first-time buyers had been declined after stating a 5% deposit on their decision in principle, when in fact they had 10%. That extra 5% could have been enough to ease the credit assessment through.
For brokers handling clients who have been turned away by mainstream lenders and are unsure where to turn, identifying the exact trigger matters before placing the case elsewhere. Stevenson aims to complete his research within 24 hours. He estimated around 80% of the clients he sees following a decline do have some form of viable option, but whether the rate attached to that option is one they can stomach is a separate question.
"It doesn't take us more than a couple of days," he said. "I try to get my research out in 24 hours."
From product finder to problem solver
The broker role has shifted, Stevenson argued, in a way that is not always visible from the outside. His own expectations when he entered the industry were shaped by listening in on a broker call his parents made when remortgaging. What he heard sounded simple – a list of lenders on a screen, a client asking for a mortgage, the broker pointing at the top name.
The reality, he said, is substantially more demanding. "That is so out of touch with the reality of the job. As I've learned the hard way, it is significantly more stressful than that. Every case is unique. Every case has its own risk elements and pros and cons as to why the bank should or shouldn't consider it. Every bank is unique in what they will and won't do. And being very biased as a mortgage broker, knowing how to navigate that could be the difference between getting your dream home or leaving it another three years."
That navigation extends to keeping up with criteria changes in real time. Lenders shift their appetite regularly. A lender that would not previously accept self-employed applicants may change that position, opening up eligibility for clients who had assumed they were excluded. Stevenson noted that more lenders have also been extending income multiples in recent months, moving towards 5.5 to 6 times income, with some offering 6.5 times on remortgages.
The brokerage fee, in this context, is not a charge for submitting a form. "It's not just a fee to submit your mortgage application," Stevenson said. "It's a fee to really present your case in the best light to the lender."
Brokers, banks, and the case for closer ties
Stevenson is direct about where he thinks the bank and broker relationship needs to go. While he acknowledged that banks are actively trying to adapt – criteria are opening up, income multiples are increasing – he argued that lenders need to more clearly recognise how dependent their mortgage books are on the intermediary channel.
"I think in mortgages around 80% of their business comes from brokers," he said. "They should recognise that we're not there to hinder them and trying to take money. If anything, we're fighting for them."
The practical case for that relationship is straightforward. When a lender updates its criteria and Stevenson takes a client through, he is not just representing the borrower, he is also making the case for that lender as a credible option. A broker who knows and trusts a lender's approach will actively direct clients towards it.
He pointed to an example from a colleague as evidence of what closer ties can achieve. A broker friend had built a direct relationship with the underwriters at one bank. The result was that cases could be discussed and agreed more efficiently, with the outcome serving the client, rather than simply serving the bank or the broker in isolation.
For brokers considering how to strengthen their own lender relationships, the value of lenders who operate with manual underwriting and direct broker contact is increasingly clear. Stevenson's view is that having those conversations, and building those relationships, is not optional, it is core to doing the job well.
"I think having the relationship is super important," he said. "They should definitely look more into that."
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