The year ahead

For years now the prospect of a major technological revolution in the mortgage market has been hinted at but never actually came to fruition. I think 2018 is going to be the year we finally see it.

Communication and the methods in which the industry converses with its clients will be a priority. Indeed, the whole premise of the much talked about robo-advice initiative is a response to the consumer demand for more efficient communication and a more streamlined service. With a number of firms exploring the idea it stands to reason that this year will be the one in which we see some real progress in this area.

Several firms within the industry are already employing real time live chat solutions, the natural next step will be the emergence of artificial intelligence. Chat bots may not quite become the norm straight away but forward thinking firms will certainly embrace them.

The launch of open banking this month across the top nine banks – including Barclays and HSBC – will have a huge impact on the market by giving consumers the chance to take control of their own financial data and who can access it. This access should also allow lenders to speed up affordability checks and verification of income and outgoings. Indeed the initiative offers huge potential for the market and should be welcome as opposed to feared.

That being said the implementation of the revised Payment Services Directive (PSD2) – the legislation behind the open banking initiative – coincides with that of the General Data Protection Regulation, with its increased safeguarding requirements. It will certainly be interesting to see how these two initiatives work together.

And of course a year in the mortgage market wouldn’t be complete without the FCA ringing in the changes. 2018 will see the next stage of the Financial Conduct Authority’s work on lending into retirement – a long overdue review and one that should benefit the large number of older borrowers who are being penalised by antiquated rules.