The One account

The One account has established itself over the last ten years as one of the leading flexible mortgage lenders especially in the current account mortgages sector. As part of RBS Intermediary Partners, it has a great proposition to offer mortgage advisers who are keen to grow their presence in the current account mortgages sector.

In recognition of the specialist nature of this type of product, in September of last year a new dedicated sales force was introduced. Headed up by Mel Buckingham, the new team concentrates solely on The One account, enabling brokers who want to grow their business in the current account mortgage sector the support of having experts on hand who can talk to them about the specific benefits of flexible mortgaging. They'll also be able to assist them to target their client bank, something that is growing in importance as the purchase markets get tougher.

Buckingham has had experience of being on the broker side of the market and says she is fully aware of the opportunities that exist and the barriers that mortgage advisers face when dealing with a product area that is not so familiar to clients.

"I guess one of the key challenges we face is that not enough is known about current account mortgages and whom they are suited to. Too many misconceptions exist, for example that it's a product only for the super-rich, that are way off the mark", commented Buckingham.

"For some it will be about pure economics - being able to use their savings and/or income to reduce their monthly repayments. For others it will be about the flexibility the product gives them in terms of the ability to borrow back or underpay when it suits them. Plus there's the tax-free element of having your savings in a mortgage."

She says that she is aware of the psychological challenge that brokers face with their clients in getting them to think differently about their mortgage and bank account. Because everything is pooled together in one place, a current account mortgage holder will see their bank statement show a deficit of hundred of thousands of pounds (the mortgage loan minus any savings or income in the account) which can take a bit of getting used to.

Buckingham continues, "One of the things that I have noticed with current account mortgages is the number of referrals your clients will put your way as a result of having recommended them a current account mortgage. I have even heard of an instance where an adviser received 18 referrals from just one client!"

One of the key things that Buckingham's dedicated team will be looking at is how to help advisers use current account mortgages as a way of generating more business from clients. Increasingly, people are using the drawdown facility on a current account mortgage to finance the deposit for a buy-to-let property. This then provides brokers with the ability to not only earn another proc fee from the buy-to-let property but open up opportunities for further proc fees as they grow their clients' portfolios.

There is also a sense that brokers themselves have a much greater appetite for diversification into other product areas, particularly with regulation such as Treating Customers Fairly (TCF) being at the forefront of advisers' minds. Selling a client a current account mortgage can provide brokers with other opportunities to talk to them about related products be they life insurance, income protection, healthcare, or longer term investments.

To help brokers to make the most of what current account mortgages offer, The One account is developing a package of support. The popular Mortgage Shrinker online calculator that illustrates the savings a client could make by taking out a current account mortgage on their monthly repayments, is being revamped. The new Current Account Mortgage Illustrator will show by how much they could reduce their mortgage term, the total savings they could make over their mortgage term and the effective rate of interest they will pay.

Another development to help brokers sell more current account mortgages is the recent introduction of a £500 cashback deal. Each client that completes a current account mortgage will receive a credit to their account of £500. The deal is running from 16 January till 27 February.

There are also a number of new product ideas that are currently being worked on that should be able to be shared with brokers in the very near future.

Even though current account mortgages have been around for a while there are still relatively few lenders in the sector compared with other mortgage sectors. This is part of the challenge in trying to expand the numbers of current account mortgages being sold. Those currently operating in this sector need to work hard to get their voices heard but, in the current climate, there seems to be a more receptive audience for this type of product.

With its strong brand presence, reputation for having outstanding service and the investment made in the new dedicated sales force the outlook for The One account, and those brokers who do business with it, is certainly rosy.