For the past seven years Frank Eve Consulting Limited has conducted research into how Lenders use Internet technology to interact with intermediaries. The findings of the study have established best practice in the industry.

The primary objective of the study is to assist lenders in setting their overall website strategy by benchmarking them against current best practice. This research assists lenders in prioritising information technology (IT) spend for new web site functionality and enhancements.

The benefits to Lenders taking part include information to:

• improve operational efficiency and increase site usage
• raise pull-through (conversion) rates of submitted acceptance in principles (AIP) and loan applications
• improve competitive position and market share

The Benefits to Software Vendors include information to:

• assist in the development, enhancement, sale and support of systems used by lenders in originating loans

Study Methodology

The Study benchmarks lenders intermediary websites and application processing systems, providing an assessment of Best Practice in intermediary distribution technology. Participating lenders completed an extensive written questionnaire. Web site functionality was segmented into the primary areas of intermediary business transaction capability and the questions were designed to identify individual features within these areas. Marks were awarded to sites that had the most features and functionality. The Study methodology was verified by a cross section of intermediaries at an intermediary Forum and a summary of this is included in the Study document.

The 2008 Study

This extensive research will be useful for planning and prioritising enhancements to your institution's distribution technology for the coming years.

Study Contents

• The study contains the following topics:
• Executive Overview
• Overview of 2008 Survey participants and study findings
• Detailed 2008 Study Findings
• Mortgage trading platforms, sourcing systems and open data standards
• Comprehensive reviews of lenders intermediary websites
• Lender research on technology best practice amongst intermediaries
• Broker research on technology best practice amongst lenders

The 2008 Intermediary Technology Study reports the findings of the first annual survey of UK mortgage intermediary technology and customer support.

Its primary objectives are to help mortgage intermediaries:

• Validate – and perhaps migrate, reposition or upgrade –processing systems
• Prioritise information technology (IT) spending for functionality and enhancements
• Establish an overall e-commerce strategy

This Study reports on the intermediary technology provided by 16 intermediary system suppliers. This gives a unique assessment of best practice in mortgage intermediary distribution technology in the following categories:-

• Sourcing Systems
• Point of Sale Systems
• Sales & Processing Systems

The study examines, for each category, system functionality in relation to intermediary business transaction capability, customer service and support. For each category, six criteria sets were used:

• Platform & Architecture
• Platform Functionality
• Mortgage Functionality
• Compliance Support
• Integration Support
• Information Technology Platform

Study Methodology

Participating system suppliers completed an extensive written questionnaire independently and the results were used to complile this Study. Unlike our Lender Intermediary Technology Benchmark Study which deals with lender technology and how intermediaries interact with a narrow set of services provided by lenders, the Systems Technology Study covers a wide range of functionality and services in sourcing, sales support and processing.

Direct comparison is difficult as the intermediary market is highly fragmented and has different requirements depending on size, business model, business volume and market. A large intermediary selling specialist mortgages via a network has completely different requirements to a small directly authorized broker. Because of this, there is no weighting of scores in each category, nor are there any ratings of each system. Any scoring needs to be objective, and this would depend heavily on the requirements of the intermediary in question.

Despite this, the study does outline a set of basic threshold requirements, current best practice and emerging best practice based on a high-level view of the intermediary marketplace.To define best practice – and determine whether it is a basic requirement or will offer the system provider with a competitive advantage – systems functionality was sorted into one of three categories: ‘basic threshold (functionality) requirement’, ‘current best practice’ and ‘emerging best practice’.

Basic threshold requirements

This is the minimum functionality required for a system to be included in the appropriate system category of Sourcing System, Point-of-Sale System or Sales & Processing System.

Current best practice

This is functionality that provides better than average service to intermediaries compared to other systems. All systems should provide this functionality within 12 months to remain competitive.

Emerging best practice

This is functionality that deals with new challenges faced by intermediaries. This functionality will be considered best practice within 18 to 24 months, and all providers will need to have it within 2 years to remain competitive.

In 2009 Frank Eve Consulting Limited is partnering with Vertex Financial Services to provide the mortgage industry an Arrears Benchmarking Study.

The recent severe market conditions have proved extremely challenging for the UK mortgage industry, with a number of lenders either ceasing trading or temporarily closing to new business.

The analysis from this Study will enable participants to establish a baseline against which to benchmark future trends in arrears activity, and to compare themselves anonymously against other lenders in the in industry. In addition, some of the questions ask for 2007 data (pre credit crunch) to enable some high level trends to be established, as well as some comparisons from the main Vertex Mortgage Benchmarking Study from previous years.