RateSwitch: Lee Flavin
A mortgage adviser for over a decade, Lee Flavin has launched a free online tool to help homeowners reduce their monthly mortgage payments
Tell us what your business does:
RateSwitch is a free online tool that uses a three-step process to help homeowners reduce their monthly mortgage payments with minimal hassle.
The first of its kind in the UK mortgage industry, RateSwitch breaks down the best loyalty rates available from your current lender in a similar format to comparison sites like Go Compare and those already operating in other sectors.
Where did the idea for your business come from?
I was passionate about raising awareness of the unnecessary costs that Standard Variable Rates (SVRs) bring and I wanted to provide a tangible solution to the problem. While working in my previous roles, I came across many situations where homeowners were struggling to move off their SVRs and felt that something had to be done to provide homeowners with more information about the options available to them.
How did you know there was a market for it?
As the first of its kind in the market, we knew that we had found our niche and, given the popularity of comparison websites in other industries, we knew this would be the perfect fit for homeowners.
According to a HSBC study from 2015, an estimated 39% of all residential borrowers repay their mortgages on their lender's SVR, which is the un-competitive default rate that most initial fixed and tracker rate automatically revert to. Many homeowners aren't aware of the options available to them so this is when we realised that there was a place in the market for RateSwitch.
What were you doing before starting up?
I was a mortgage adviser for 10 years, working in-house with leading financial organisations.
Have you always wanted to run your own business?
It wasn't always my intention to start my own business but, as time has gone on, I felt the time was right and the product we were creating would potentially be a game changer for the UK's mortgage market.
How did you raise the money?
Myself and my business partners, Jason Stallard and Lyanna Tsakiris, were awarded a grant as part of Wales' first tech accelerator the ‘Ideas Fund'.
We then went on to secure a sizeable seed investment from Finance Wales in a deal facilitated by Capital Law. This funding has been incredibly beneficial in helping our business get off the ground and begin trading.
Describe your business model and how you make money:
As mortgage advisers, we continuously work to provide homeowners with the best rates. Our remuneration is linked to doing precisely this, whilst also helping lenders retain their existing customers.
What challenges have you faced and how have you overcome them?
Within the mortgage industry, we adhere to detailed compliance processes in the interest of delivering the correct advice and treating customers fairly. We've had to work closely with the FCA to ensure that we maintain the highest level of compliance standards
What was your first big breakthrough?
Personally, getting accepted onto the Ideas Fund Swansea accelerator and having the chance to pitch at Google campus in London was a major breakthrough for the business. This confirmed that the proposition was credible and gave us the confidence to drive the business forward even further.
What advice would you give to budding entrepreneurs?
I would say that you need to ensure that you have a solid business plan in place before driving forward with your business idea.
Before officially establishing RateSwitch, I was keen to get expert advice from other business owners and from marketing moguls who were able to help me position the business correctly.
Where do you want to be in five years' time?
RateSwitch has currently been valued at £1m, which is an extremely promising start for our business.
I hope that we can become the go-to service for homeowners looking to achieve a better loyalty rate for their mortgage. We want homeowners to know that they always have options and if we can help them to get a better rate, then we will.