Business 10 Minutes – Paul Kielman from Kielman Mortgages

Strategic Financial Guidance for High-Value Homebuyers: Kielman Mortgages - A Niche Mortgage Advisory Model

Core Synopsis

Our 10 minutes speaker, Paul Kielman from Kielman Mortgages, has defined a clear strategic niche: targeting high-earning, self-employed individuals and upwardly-mobile employees who are ready to upgrade from their starter homes to larger, more expensive properties. This focus is a direct response to a market segment with growing profits or salaries but complex financial profiles that require specialized guidance on affordability, mortgage terms, and future earning potential.

The advisor's operational model is built on two core pillars:

• First, providing upfront, detailed financial mapping to show clients exactly what profit or income levels they must achieve to secure their desired home;
• Second, a "completion-only" fee structure which acts as a personal guarantee and aligns his success directly with the client's.

This model positions Paul not just as a transaction facilitator but as a long-term financial strategist for a client's home-buying journey, a journey that now often requires unconventional mortgage terms extending to age 75 or 80.

Service Model and Market Position

The Target Client Profile

The advisor's service Paul offers is explicitly designed for clients undergoing a significant financial transition, specifically those who have outgrown their current living space ("pokey two bed") and now possess the capital or earning potential for a substantial upgrade ("four five bed detached"). Two primary segments are identified:

• Self-Employed Entrepreneurs: Individuals who have successfully built their business profits and are looking to leverage that success for a better home. Their challenge is translating variable business income and tax accounts into a format mortgage lenders will accept.
• Upwardly-Mobile Employees: Professionals who have risen through corporate ranks, securing promotions and higher wages, and now seek a home that reflects their new financial status.

The Core Value Proposition: From Ambiguity to Clarity

The central service is to assess a client's complex financial reality and map a precise path to their desired property. This involves a multi-factor analysis beyond a simple income multiple:

• Profit & Income Assessment: The advisor determines current borrowing capacity and, more critically, calculates the future profit/income levels required to meet the client's goals. This is vital for self-employed clients whose eligibility is tied to specific tax years.
• Legacy Financials: The process includes untangling existing financial obligations that impact borrowing, such as shared ownership schemes, Help to Buy equity loans, and current mortgage balances.
• Extended Mortgage Terms: To manage the high capital requirements of larger homes, especially for clients in their 40s and 50s, the advisor utilizes lenders offering terms up to age 75 or even 80. This requires a detailed discussion of retirement income, including workplace and private pensions.

The Business Model: Alignment and Network

• Risk-Reversal Guarantee: The advisor's fee is charged only upon successful completion of the property purchase. This de-risks the process for the client, as the advisor remains committed through multiple failed property searches or seller pull-outs without additional cost.
• Professional Network: The service extends beyond the mortgage itself, providing clients access to a curated network of professionals essential for a home purchase, including conveyancing solicitors, will writers, financial advisors, accountants, and various trade contractors.

Market Analysis and Product Insights

Market Conditions

• Recent Recovery: After a period of extreme hesitancy before the last government budget, the market has seen a significant pickup in activity since December. Estate agents and solicitors are reporting increased inquiries and business.
• Interest Rate Outlook: While fixed rates saw a minor increase recently (adding £20-£30 to typical monthly payments), this was a preemptive adjustment by lenders who had anticipated more aggressive base rate cuts than are now expected for the year. The overall market direction is viewed as positive.

Product Strategy: Fixed vs. Tracker Mortgages

A dialectic exists between the security of fixed rates and the flexibility of trackers, with client choice splitting roughly 50/50.

• Tracker Mortgages: These products offer significant flexibility with no early repayment charges, appealing to clients who want the option to switch. With a 40% deposit, rates are competitive (e.g., 0.14% above the base rate, recently quoted at 3.89%). They are advantageous if base rates fall as predicted.

Fixed-Rate Mortgages: Two and five-year fixed products provide payment certainty but lock clients in with financial penalties for exiting the term early. They remain the preferred choice for risk-averse clients.