What are the big challenges in the later life market?

[00:00:00] Simon Meadows: Hello everyone and welcome again to MITV brought to you by Mortgage Introducer, where today we're discussing the later life lending markets. And I'm delighted to be joined today by Scott Burman, who is Head of Distribution at Pure Retirement. How are you, Scott? [00:00:18] Scott Burman: Very well, Simon. Thanks for taking the time to speak to me today. [00:00:22] Simon Meadows: Oh, it's great to have you along. Thank you for doing this. So why don't we start by finding guys a little about Pure Retirement. Parish the thought for those that don't know. Let's hear in your words about the business. [00:00:34] Scott Burman: Yeah, sure. So Pure Retirement are an equity release only specialist lender. We are based in Leeds, just outside of town called Garthworth. And we're actually just celebrating our 10 year anniversary in May just past actually. Still privately owned. And Paul Carter, in fact, our CEO, who helped set the business up just over 10 years ago, is still our CEO today. Over these years we've accomplished some great things and we're actually around £5.5 billion under management now. It probably puts us into a space around a mid-sized boom society. That's through our own origination of Epitulius Mortgages, but also winning and servicing back books from funders as well. As you mentioned, I joined the credit distribution 18 months ago, looking after the sales and marketing teams and very much enjoying my journey in later life lending over that period as well. So what would you say sets apart Pure Retirement from others in its market? There's probably a couple of things here, Simon, mitv_pure_retirement_-scott_burman_b(1080p) (540p).mp4 [00:01:36] Scott Burman: for me. We have a phrase actually that we call it here at Pure Retirement, which is we're large enough to compete and small enough to care. So we pride ourselves on the service that we deliver to our broker partners, right from registration all the way through to completion and also post-completion with our consumers. We've recently won our five-star FTC Service Award, voted by brokers. and also the Smart Money R1 2024 award as best later life lender. So that's all backed up by our people. We probably expect we can say, but we've got some great BDMs that offer appointments in the field and face to face, but also backed up by telephone BDMs who are very knowledgeable and always on hand to be brokers best advised to help support in their advice journey with the shears. So how do you view the later life lending market currently and its challenges. How is it faring? So it's been challenging. I think like most aspects of the financial services market, mortgage is mainstream, buy-to-let and late-life lending market has obviously suffered over the last 18 months. I think everyone's aware of that and that's in the history. I think we are seeing a what I'd call a bottoming out of the late-life lending market. We can see that the consumer's appetite is there. We can see and hear from our broker partners that the leads are coming through and rates are now stabilising. So that's a good thing. As I mentioned earlier, loan-to-values are now back to what they used to be almost. You can now get just over 50% loan-to-value in the market. So I think those two aspects have probably held the market back a little bit last year. Going forward, mitv_pure_retirement_-scott_burman_b(1080p) (540p).mp4 [00:03:00] Scott Burman: I still think the biggest challenge we face in the later identity market is advisor understanding and wider consumer knowledge about this space and what property wealth can do to consumers and help them in their retirements, help their family members. And I still think the biggest thing that's holding us back is how much awareness we need to keep banging the drum. We work very closely with Equity Release Council, who do a great job, but I think that's probably the thing that's holding the market back still, is the awareness of what later life then we can achieve with consumers. To what extent would you say that product innovation contributes to the market's ongoing resilience. Yes, it's been very positive actually. We've had a couple of innovative products that launched post-consumer duty, which is called Payment Lifetime Mortgages. There's a couple of plans out there at the moment. Fewer time I don't offer them, but it's great innovation for our buyers to have a look at, see if there's solutions for the consumers. So it's been really positive and that needs to continue. What I would say is we need to be a little bit careful that we are making sure we innovate to solve problems, but we also should supports the advisors that are in this space to understand and really become knowledgeable so they have confidence advising consumers on it we've done some research ourselves getting some broker feedback and it's clear that the tools that are out there the knowledge and awareness needs to improve and I think that's on us as providers to support brokers with that so I think it's very positive I think lenders and providers including ourselves should challenge ourselves to continue to innovate. But let's make sure we're doing it for the right reasons, which is solving problems and help advisors understand the solutions that are out there. mitv_pure_retirement_-scott_burman_b(1080p) (540p).mp4 [00:04:38] Simon Meadows: What product enhancements can you offer as a lender? And how have they been integrated into your strategy to deliver best outcomes? [00:04:44] Scott Burman: Yeah, so at PureSum, we work really hard to innovate and deliver products that solve consumer needs. And what we've done already this year is we have... increased our age limit up to now 90 on completion. We have offered cashbacks on some of our product range to help customers achieve the best loan size they can on their property. We have increased our loan to values and probably a key one for me is also enhanced our property criteria particularly around the residential properties that are closer to commercial. So that's what we're doing already. What we've also now launched is our interest service team. mortgage, coined as ISN in our latest life benefit market. So this is where a consumer can pay their monthly payment. The minimum needs to be 25% of the monthly interest only payment, and they get up to 1% discount. So this helps in terms of the roll-up, which is obviously probably common in the opportunity space, whereby paying a small amount per month, it reduces the roll-up and the consumer gets a rate discount as well as a benefit. So these are a product that sits between the traditional sort of real mortgage that people will be aware of and the equitability standard. So these consumers do not need to go to it for any forability checks. They can take payment holidays. There is no risk of repossession and there's no risk of credit challenges if there is any payments still satisfying the five equitability council standards. Excellent. And to what extent would you say that a technology enhanced service can drive ongoing market growth? Yes, we've looked at this ourselves. I suppose there's two sides to this. mitv_pure_retirement_-scott_burman_b(1080p) (540p).mp4 [00:06:30] Scott Burman: We're looking at differentiating ourselves in the market against our competitors, but also achieving better consumer outcomes. So that's what we looked at and what we had in mind with our online portal and our online application process. We recognise we're answering more questions upfront. It's a a fast slicker and streamlined service for the broker and for the consumer. So now we have about 70% of our cases input by Brobers onto our online portal that goes straight through to evaluation, making it very simple, very slick and easy to deal with. We've also enhanced our MyPure. So MyPure has about 6,000 registered users now. MyPure is a customer-facing online account management, very much probably similar to what me and you have on our online banking in the following. So they can go in, they can see their plan, they can manage their plan, they can show their plan to family members if they choose, but of course they can show their plan to their brokers for annual reviews. So it puts the visibility and power of their equity release plan in their own home. So Scott, what would you say is the future of the later life lending market in your view? Yeah, so for me the future is bright. I think I mentioned earlier I think the positive amount of the market. to getting past that now i think the innovation is really helping i think if you just look at some of the stats that are out there you know this three and a half trillion pounds were tied up in the 55s properties uh we also see in the mainstream space that first-time buyers are getting older not only that they're taking out uh mortgages now well into if not past their retirement ages, you get a lot about 35, 40 year mortgage terms. And of course, pensions are not what they used to be. So we think the late-life lending plays a vital part in the ongoing servicing and supporting of people in their retirement. Well, that's a positive note on which to end our conversation. It's been fantastic talking with you today, Scott. Thank you so much for sharing your time. mitv_pure_retirement_-scott_burman_b(1080p) (540p).mp4 [00:08:23] Scott Burman: Thanks for your time, Simon. Good to see you again. Good to catch up. [00:08:27] Simon Meadows: Well, that's it for this edition of MITV brought to you by Mortgage Introducer. Do join us again for more industry insight. In the meantime, thanks for watching. Goodbye. mitv_pure_retirement_-scott_burman_b(1080p) (540p).mp4