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Brokers' verdict on UK Finance's Reach Out campaign

Journalist: Riz Malik

ended 31. July 2023

UK Finance has launched a campaign, backed by lenders, to encourage individuals to contact them if they are having difficulty making mortgage payments. The banking and finance industry's Reach Out campaign will be visible across radio, print, and internet beginning Monday, July 31 and on television in September. Lenders are backing the ad, which is being prepared in collaboration with M&C Saatchi London. The campaign followed the release of the Mortgage Charter, in which the government, lenders, and the Financial Conduct Authority committed to extensive new customer support measures.  UK newswire, Newspage, asked brokers for their views. on the campaign and whether there could be any unanticipated consequences for future loan applications.

7 responses from the Newspage community

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Riz Malik
Independent Financial Adviser at R3 Wealth
Promoting awareness is a superb idea, particularly when it informs those who need it the most. I am worried about the enduring effects of the Charter. We have been told that taking the support will not impact your credit record, yet how will lenders interpret it in the future? After Covid, lenders continued to question payment holidays taken during the pandemic. This matter needs urgent attention.
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Michelle Lawson
Director at Lawson Financial
'Reach Out' is one of my pet hate corporate phrases that seems to have made its way into the English language. It actually puts me off full stop. The idea, I am sure, is made with good intention but it seems to have omitted the option, and surely a recommendation, for the public to take appropriate advice around their actions. The majority of lender staff that the public will speak to will be order takers and do not have the qualifications, knowledge, expertise and experience that brokers have and could end up unintentionally disadvantaging the people they are trying to help. All in all, a missed opportunity to champion the benefit and right to advice.
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Ranald Mitchell
Director at bad credit mortgage specialists Charwin Mortgages
This is positive and encouraging. Many people who are struggling instinctively heap more on credit to get by but this only worsens the problem. Initiatives like this raise awareness and will pave the way for consumers to talk to their mortgage providers, or seek independent advice. Short of loss of income, there are usually things that can be done to help customers overcome difficult times and unfortunately, many we speak to would have been much better served if they had contacted us sooner rather than later.
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Stephen Perkins
Managing Director at Yellow Brick Mortgages
It is good to spread awareness of what support is available to borrowers. However the concern is that no advice is being given as to whether the options available are needed or most suitable. With the stipulations around needing to switch back after 6 months likely to be missed by many, it will almost certainly lead to affected credit ratings and problems for many with future borrowing.
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Scott Taylor-Barr
Principal Adviser at Barnsdale Financial Management
In the past one of the biggest issues with people struggling to pay their mortgage and other debts is they bury their heads in the sand, avoid all contact with the lender and generally hope it all goes away. It never does and invariably avoiding the issue simply makes it far, far worse. The real shame is that lenders have various support mechanisms (and always have had) they can use to help borrowers in distress, but only if those borrowers engage with them, so a national advertising campaign that helps the general public to realise that can only be a good thing.
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Ben Tadd
Director at Lucra Mortgages
All in all it's a positive campaign message for many mortgage borrowers. It will serve as some light relief for many homeowners who will be naturally anxious about the impending new higher mortgage payments they will undoubtedly face when their current fixed rate deals come to an end, anytime in the next 6-12 months. At the very least it provides a beacon of hope that there are some options at least to consider that may alleviate their financial woes albeit temporarily, and provide borrowers with some time to consider their options and plan their next steps. The danger of course is that the message may also act to encourage those that don't necessarily need to extend their term or switch to interest only for 6 months, to take advantage of the facility, and take a form of payment holiday, just because they can. It is imperative that the campaign message is balanced and illustrates the risks of paying more interest and potentially having to work longer, to balance the message out.
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Austyn Johnson
Founder at Mortgages For Actors
Great idea, hopefully, this could ease the amount of worry about repossession in the UK. If lenders can help, it's a good idea. But it must be taken with advise, lenders should also advise their customers exactly what the changes will mean. for example, deferred payment will make their mortgage longer etc.