Why consolidation is the topic to discuss with clients
“With a jump in the rate of inflation and life as if returning to normal, people will feel the financial and emotional strain of many challenges hitting them all at once.”
The important thing to remember is that while we will all have to adapt to rising annual gasoline prices or fuel costs (whether you have a diesel or gasoline vehicle), there are customers in circumstances where these changes don’t just cause mild frustration. and a reduction in a large monthly surplus. Many customers will be materially affected, and without action their ability to pay their monthly bills – or at least feel comfortable with their financial situation – is put at risk.
As individuals, we are thankfully now much more aware of the importance of mental health. Although we are better equipped to deal with stress and anxieties such as those caused by money worries, there are practical solutions that can be taken to alleviate these problems. Often overlooked or ignored, the second mortgage market is a valuable tool that can be used to make a truly positive difference to a client’s financial situation and well-being.
Over the years I’ve seen many cases of second charges, ranging from customers with good credit profiles but who overcommitted and are now stretched (while maintaining their payments), to customers who have suffered adverse credit events such as CCJs, defaults or worse. The common theme, regardless of their credit history, is that they are having difficulty with their credit commitments.
What’s also true is that there’s always a ‘why’ that differentiates us and our lenders when we listen and take a ‘common sense’ approach. Last but not least, my team and I are fortunate to be able to help clients find sustainable solutions that work for them.
The fact is that for an extended period the rate of inflation was kept under control. Additionally, many people have felt the benefits of reduced travel costs and discretionary spending throughout the pandemic. Now, with a jump in the rate of inflation and life as if it is returning to normal, people will feel the financial and emotional strain of many challenges hitting them all at once.
For this reason, we believe it is essential that all mortgage intermediaries actively review and explain the options to consider when it comes to debt consolidation, whether with a mortgage, a second mortgage or an unsecured loan.