These figures continue a trend noticeable since H1 2019, which the pandemic has only exacerbated. And with the housing market in boom, activity and performance levels are going to be under greater pressure throughout 2021.
To do-up or to sell-up, that is the question.
Our homes have become even more important to us over the last year, and the amount of time we have spent in them, combined with the opportunities that more flexible working practices offer, has led to considerable activity in the market.
Payment holidays on mortgages were one of the first financial support initiatives announced by the Government at the start of the pandemic. Not controversial on its own (most mortgage products already had these options built in), the confusion over credit score impacts and long-term repayment plans, together with an increase in those struggling to repay at any amount, means the gap in expectation and reality for many consumers revealed these payment holidays were not the ideal solution they were presented as.
In addition, the introduction of the stamp duty holiday has further fuelled the housing market with even greater demands placed on lenders as buyers and sellers rush to beat this deadline.
With the market expected to remain buoyant throughout 2021, it is even more important for home finance lenders to get a handle on the customer engagement and complaints process to prevent a worsening problem as they struggle to meet increased demand.
Top tips to reverse these unwanted trends
Demand for Consumer Credit and Home Finance services are set to remain high as we emerge from lockdown throughout this year. The long-term financial impacts are still only starting to be felt as Government sponsored schemes come to an end and companies are looking for a return to the “old” normal.
Whether credit and loan complaints are rising or falling, companies are clearly struggling with the underlying process of handling their complaints in the timely manner required by the FCA.
How can already busy companies make these changes when their BAU is taking up all their time. The smart ones ask for help. Getting in an external firm to review processes and identify areas for efficiency and beneficial change can make a real difference to day to day running. But where to direct this external help?
At EQ, we often find the challenges lie in three main areas:
- Process and people optimisation – Is the customer journey as smooth as it could be for both sides? Do the systems you use help rather than hinder? Are your people being used in the right way and do you have enough of them?
- Communication with customers – How are you managing consumer expectations? What communications channels are you using? Are they fully joined up? Are you doing all you can to identify vulnerable customers and offer them support?
- Evidence of activity and audit trails - Are you sure the customer has fully understood the implications of a payment holiday or loan? Do you have fully confidence in the advice you give at each stage? How do you evidence this?