‘Growth areas’ are second charge, bridging and commercial – Rainbird

By Anna Sagar

May 16, 2022

The second charge market will continue to grow as consumer demand and lender proposition expands, according to Truffle Specialist Finance.

Speaking to Specialist Lending Solutions, managing director of Truffle Specialist Finance James Rainbird (pictured), said that the firm had had a record quarter for second charges in its most recent three-month period.

He said it was “happy with its direction of travel” in the space, however, he said that the firm was looking to ensure it had the “right resource going forward to keep pace with demand”.

“There is strong, and growing demand in this product space, and it’s up to us to ensure we are effectively resourced to continue to meet that demand,” Rainbird noted.

Rainbird said that this is an area of growth as consumer awareness of the product increases and lenders continue to bring out new product offerings.

He also pointed to the withdrawal of further advances and remortgages as a potential “boost” to the second charge mortgage market.

Rainbird said that it could be “very difficult” for new businesses to enter the market without “real experience and lender relationships”, adding that lenders’ back-office teams could be “challenging”.

He said that the firm’s underwriters were “working tirelessly” chasing consents, redemptions and building society questionnaires, and that this could slow the process as a lot of bank staff were still working remotely.

“The volume the banks are receiving as well is high. You’ve got to have a good back-office team, good CRM systems in place to ensure that you’re getting those results then for the consumer and for the introducing brokers,” Rainbird noted.

He added that “strong working relationships” with lenders, surveyors and accountants were “absolutely key”.

Rainbird continued that bridging and commercial was a “key area of growth for the firm” and that locally it was looking to grows its first charge and protection division as it was “actively recruiting in that area”.

Based in Penarth, which is just outside of Cardiff, Rainbird said that several lenders had left the high street, which presented an opportunity for Truffle to fill the gap.

He said that Penarth was predominantly made up of over-40s, professionals and quite an affluent area, with many still wanting to have “face to face” meetings.
Rainbird said that whilst it was always looking for the “right candidates” to grow its advisory team, this had to be balanced with back-office support.

“You can write as much business as you want, but if you don’t have the back office support and relationships then you’re going to struggle. So yeah, there’s a balance for us between advisers and underwriting,” he said.

Investing in CRM system to give brokers ‘accountability and better reporting’

Rainbird said it was “investing substantial funds” into a new CRM back-office system, which will “help streamline our internal process” and give “brokers some accountability and better reporting, a case tracking system as well, where they can actually upload documents”.

He added that this would “minimise the amount of traffic” that’s coming into the office, such as emails and phone calls.

“Technology is hugely important for our business going forward and for our introducing brokers as well, if we can make it increasingly attractive for them. It helps in terms of reporting, incentives and client retention– if we have greater automation, it incentivises our introducing brokers to stay with us,” he explained.


Affordability challenge for consumers

Rainbird said that Truffle had seen an increase in applications across all product sectors but was not able to place a number of them due to affordability issues.

He cited several factors that were impacting affordability, including interest rate rises and cost of living increased.

“We’re often still able to find solutions for clients in those circumstances. That’s a positive in itself because we are saying to our introducers, who have those clients, that we are able to help them place those deals,” he noted.

The business offers specialist first charge residential, second charge, first and second charge buy-to-let, bridging, equity release, development finance, commercial finance and mortgage protection business.

“Affordability has always been an issue. But, thankfully, we’ve got lenders that are proactive, and they’re always looking at ways they can perhaps tweak their criteria in order for us to continue to write business and for consumers to have the right products.”


Rebrand has led to increase in new business

Rainbird said that there had been “incredible reception” from existing brokers, the media and local businesses following the rebrand to Truffle Specialist Finance.

He said that there had been a perception from local businesses that the firm only did second charges, unsecured and payday loans, however, this had now changed.

Rainbird said that it had seen an increase in new accounts since the change.

“I think from where the business was and has come from, to where we are today, certainly as an industry and as a business the word loans has become antiquated. If we have a look at the suite of products that we offer, the word loan is not used,” he said.

“I think it was perfect timing for us to just to bring the brand up to date and for it to also reflect on our time in the industry, our professionalism and our commitment to the industry as well.”