An Open Letter To Mortgage Brokers.

MSE_Martin

alexandlee wrote: »

3. Martin's view on brokers / latest guide. Martin is broker friendly when we are able to read the guides and posts on the MSE site. The difficulty is that when he appears on GMTV or Radio 2 going at ten to the dozen people pick out what they want to hear. So when he says go to a WOM fees free broker, and then go direct to see if you can get better then thats what the public will do. Take this to a logical conclusion. Huge numbers of brokers and firms (esp. fees free) will go the wall becuase they won't do any business, and won't recieve the commission. Subsequently the public will then not be able to go to a WOM fees free broker because there won't be any left.

Alternatively many may just hear 'go to a WOM broker'. To argue I shouldn't give full details as some may act partially on it seems strange to me. My point is very plain I focus on "never go direct", "always go to a broker". And that's the main message people take. Yet even so, to even possibly suggest i shouldnt be sending people to the FSA site as well - to protect brokers is rather strange?

Martin

dunstonh

Yet even so, to even possibly suggest i shouldnt be sending people to the FSA site as well - to protect brokers is rather strange?

The FSA site is notoriously unreliable on its data. Biggest issue is out of date info and is based on assumptions (where multiple options exist that could alter the price). In cases of non mortgage business, it tends to assume full commission pricing with no enhancements in product price or commissions. IFAs cant use the FSA site for research as it wouldnt be quality research and compliant (bit of an irony that using the data from the FSA could lead to you being fined by the FSA).

feisty1

dunstonh wrote: »

The FSA site is notoriously unreliable on its data. Biggest issue is out of date info and is based on assumptions (where multiple options exist that could alter the price). In cases of non mortgage business, it tends to assume full commission pricing with no enhancements in product price or commissions. IFAs cant use the FSA site for research as it wouldnt be quality research and compliant (bit of an irony that using the data from the FSA could lead to you being fined by the FSA).

Thks dunstonh........... as another IFA I support this and hope Martin heeds the irony of these posts!

MSE_Martin

The point about the FSA site is well made; like many things in life, it isn't perfect, and its one of the reasons I generally back away from FSA site for many comparisons. However the aim is that consumers check any direct options just in case, as an final measure then take it back to a broker to discuss.

My frustration here, is that I truly understand brokers arguements, but my job isn't to think in brokers best interests, its to give consumers as much information as possible to help themselves (which includes directing to brokers) and for me to ignore direct mortgages would be irresponsible.

martin

koexelek

MSE_Martin wrote: »

My frustration here, is that I truly understand brokers arguements, but my job isn't to think in brokers best interests, its to give consumers as much information as possible to help themselves (which includes directing to brokers) and for me to ignore direct mortgages would be irresponsible.

martin

Agree with you totally.

As a broker myself, part of me would love to ignore all the direct only deals, but I have to do the best for my clients, whether it earns me any money or not.
I am sure most of the lenders would like to see us brokers crushed, and the clients having to go to them direct every time, leaving them to sell their carefully marketed products on an " information only basis" ( with no further comeback), and cross sell their expensive insurances on the back of them.

Worrying for me that the likes of Bank of Ireland/ Bristol & West have taken that route this week.

MSE_Martin

koexelek wrote: »

I am sure most of the lenders would like to see us brokers crushed, and the clients having to go to them direct every time, leaving them to sell their carefully marketed products on an " information only basis" ( with no further comeback), and cross sell their expensive insurances on the back of them.

This is something that worries me too... which is why I've both made representaions to the FSA about it, done it in broadcast and indeed even on prime time ITV - talked about the problem of lenders not allowing brokers to access deals (yet even with that, i still received broker complaints on that particular programme - can you believe it - it takes the cherry doesn't it!)

Yet sadly I haven't seen any movement on it. And it the damage to the broker sector being done by both that and the obvious massive decline in mortgage approvals, and lower required LTVs required to remortgage is a real worry to the sector and for consumers.

dunstonh

My frustration here, is that I truly understand brokers arguements, but my job isn't to think in brokers best interests, its to give consumers as much information as possible to help themselves (which includes directing to brokers) and for me to ignore direct mortgages would be irresponsible.

You know that the mortgage advisers that are regulars here understand that and have no problem with it and wouldnt expect any different. Past threads have things where we would suggest something can be tweaked but that is just fine tuning.

The mortgage adviser industry has had a lot of new recruits over the last 5 years. Companies set up to train people and get them out there earning money with promises of £100k a year being easy. When in reality year 1 is usually closer to £15k. Over half of new advisers fail and leave the industry within 2 years, usually in debt. And that was in the good times. It is well known and documented that there are far too many mortgage advisers to satisfy the demand, even at the peak. A lot of these people are also not suited to giving professional advice either but are enticed by potential good earnings. The mortgage advisers are now facing a Darwin event which will wipe many of them out just as it did in the 90s.

I think when people are fighting to stay afloat and keep their homes they will turn against anything that they perceive as a threat to them and often they are not in the frame of mind to use common sense or be objective. You are a high profile target.

You wont believe the number of times I cringe when I see one of these idiots have a go at you (and I know other advisers do as well). Especially the language and content at times.

feisty1

MSE_Martin wrote: »

deals (yet even with that, i still received broker complaints on that particular programme - can you believe it - it takes the cherry doesn't it!) quote]

Particularly, if the cherry is fixed in ice & saved

MSE_Martin

feisty1 wrote: »

MSE_Martin wrote: »

deals (yet even with that, i still received broker complaints on that particular programme - can you believe it - it takes the cherry doesn't it!) quote]

Particularly, if the cherry is fixed in ice & saved

I had been happily engaging, Im not sure of the relevance of the icesave comment to a mortgage discussion (its as if you think i've something to hide on icesave, i certainly dont), but as a snide attempted dig it has had the effect of making me not want to bother spending my time discussing this much more.

feisty1

Hmmm, excuse me, "snide attempted dig"

Quote "it takes the cherry doesn't it!"

Pot, kettle comes to mind................