Five lenders are to pilot a new predictive mortgage modelling software from Mortgage Broker Tools (MBT), the group has confirmed.

This new software, MBT Sandbox, allows lenders to deliver improved mortgage propositions, helping them to make smarter product, pricing, criteria and affordability decisions using advanced analytics and real-time data.

Within the Sandbox, lenders can edit over 60 criteria elements including loan-to-value (LTV) and maximum loan by mortgage type, repayment type, term, age, and maximum income. Lenders can also edit initial and reversion rates, as well as stress rates, to see how pricing impacts elasticity once criteria and affordability are taken into consideration.

MBT revealed that Sandbox uses live information from its data resources and provides lenders with real-time insights that enable them to make data-driven decisions based on market demand.

Commenting on the launch of the new software, MBT CEO, Tanya Toumadj, highlighted that Consumer Duty is “just around the corner”.

“The new regulations will put greater emphasis on lenders demonstrating products have been developed with fair value in mind to meet particular customer requirements – and this will require data to show rationale,” Toumadj said.

“MBT Sandbox provides lenders with a ground-breaking data-driven approach to product development, enabling them to create and refine products with specific customer segments in mind. By more accurately targeting customer types, lenders will be able to more easily demonstrate the approach they have taken and their reasoning why they believe the product will result in a positive customer outcome.

“We are now working with five lenders to help ensure they are able meet both their regulatory obligations and commercial objectives, by taking a smarter, more data-driven approach to product development.”

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