Morgage Advisors/Brokers - how bad are they ?

GeorgeHowell

kingstreet wrote: »

Not the case. Whole market is the description for commission-only brokers who would not recommend a direct to lender non-commission paying product.

Independent is used for those offering advice on commission or non commission paying offers on a fee paying basis and where any commission earned is rebated to the borrower at completion.

So how does the client know what commission has been earned and whether what is rebated is the full amount ?

trulysaintly

GeorgeHowell wrote: »

This qualification is one of those where the exams are short, and comprise just multiple choice questions. Better then nothing in order to demonstrate a grasp of the basics, but I would lay a pound to a penny that the rather arcane details of the sort of issue that came up in the instance that I am describing would not be covered in the course and exams. Also I have been unable to find an unequivocal statement anywhere that mortgage advisors absolutely have to have this qualification in order to practice under FSA regulation. It may be the case, but I have been unable to find that confirmation. I wonder if there is another loophole whereby some can slip through the net -- maybe by successfully arguing in 2004 that they were 'qualified by experience' ? As I said before, if there's a loophole to be had anywhere I'm pretty sure this one will find it.

George, if you want to find out more about the CeMAP exam, and its contents, the IFS and CII offer these qualifications.

It's not the style of qualification you imagine, and since 2004 it is essential to have this in order to trade or act as a mortgage adviser.

As advisers we HAVE to show our ongoing competence in order to continue in the role. Regardless of what IFA's may say, we still have tough regulation to follow - it's one of the reasons that there are now only 10k advisers across the UK as opposed to over 36k in 2006.

The FSA has a complete register of all individuals whether directly authorised via them or another company.

trulysaintly

GeorgeHowell wrote: »

So how does the client know what commission has been earned and whether what is rebated is the full amount ?

On the Key Facts Illustration, it declares specifically the amount of commission generated by the mortgage sale.

Completely transparent, and no, these forms cannot be doctored. ;-)

kingstreet

GeorgeHowell wrote: »

So how does the client know what commission has been earned and whether what is rebated is the full amount ?

The initial disclosure document sets out the agreement for a fee to be paid and commission to be rebated at completion.

The adviser then gives the borrower a key facts illustration (KFI) at the point of application and this shows the commission payable, if any. It would also show the rebate to the applicant.

The mortgage offer, which comes direct from the lender, confirms the amount and the rebate, so there's a secondary check to ensure the initial disclosure has been made correctly.

No fee may physically be paid by the borrower. The broker may simply issue a balancing statement on completion, evidencing the commission paid against the fee due, with any balance due to the borrower.

GeorgeHowell

Well it all sounds good, and no doubt in 95%+ of cases it is.

Nevertheless there is no doubt that the character involved in this instance is guilty of either of a degree of incompetence/poor judgment/negligence or trying to pull a fast one, or most likely both. They may well have covered their tracks, which combined with the relative naivety of the mortgagor could mean that on face value they have complied with every requirement. They may be in a position to deny things which I know to be the case.

I wondered whether posting this up might lead to a lot of people saying "Oh yeah I've had similar issues with mortgage advisors !" (as with the Tesco Bank thread). The fact that it hasn't tends to indicate that there are not many out there as bad as this one, which is a good thing. As someone has said, there are a few bad apples in every barrel.

GMS

GeorgeHowell wrote: »

I think we are definitely still in the pre 2004 era in this case. It looks as though the mortgage application will probably be accepted, and the mortgagor will probably think the advisor has overall done a good job for them. There is no formal complaint against the advisor, nor likely to be. The only complaint, per se, is from me, looking at how this character has operated, and the clear deficiencies compared with what various experts on this thread say should have happened.

It is difficult to grasp exactly what you are wanting to achieve here. You state that the applicant will think the adviser has done a good job and that the mortgage is likely to be accepted. No complaint will be made by the applicant.

Without knowing exactly what your issue is how can anybody say for sure?

I may well be putting 2 & 2 together and making 5 but if you feel there is a real issue here then your relative needs to address it unless they are party to whatever it is you feel gives you the right to question the advice given to somebody else.

Somewhere along the line there is a real possibility somebody has not given the full story whether it be your relative to you, or the adviser to the lender.

GeorgeHowell

GMS wrote: »

GeorgeHowell wrote: »

I think we are definitely still in the pre 2004 era in this case. It looks as though the mortgage application will probably be accepted, and the mortgagor will probably think the advisor has overall done a good job for them. There is no formal complaint against the advisor, nor likely to be. The only complaint, per se, is from me, looking at how this character has operated, and the clear deficiencies compared with what various experts on this thread say should have happened.

It is difficult to grasp exactly what you are wanting to achieve here. You state that the applicant will think the adviser has done a good job and that the mortgage is likely to be accepted. No complaint will be made by the applicant.

Without knowing exactly what your issue is how can anybody say for sure?

I may well be putting 2 & 2 together and making 5 but if you feel there is a real issue here then your relative needs to address it unless they are party to whatever it is you feel gives you the right to question the advice given to somebody else.

Somewhere along the line there is a real possibility somebody has not given the full story whether it be your relative to you, or the adviser to the lender.

The primary purpose of the thread was to see if a number of other clients have had problems. Almost all of the responses have come from financial services professional. Interesting and informative though many of these are, it is clear that the main agenda is to question the validity what I am saying and diffuse any criticism, direct or implied, or mortgage advisors.

As I have said, I am not willing to divulge details. That will obviously leave the door open to posts like the one above, more or less saying that it's all trumped up by me and/or the mortgagor.

Some of the financial professionals around cannot be very busy if they have little else to do than trawl internet forums looking for critical posts by punters to try to de-bunk.

handytips

Well i am a Cemap qualified Whole of Market Mortgage Advisor, and i am part of a Network George, i charge a broker fee and i also get a commission from the lender. I work mainly from referals or from enquiries left via my website. In the past i have arranged Sub Prime mortgages as well as Prime mortgages covering many differing cultures. Fact of the matter is this, you will get good and bad in any profession, however i pride myself on the advice i offer my clients, you will see all across the mortgage threads of people who profess they are able to arrange their own mortgage and then moan when the computer says NO. A good broker will know the quirks and criteria's of most of the lenders, which imo is a very important factor when it comes to selecting a mortgage for a client, as guess what. Each and every circumstance is Different believe it or not. Most of the general public do not realise that mortgage deals are banded according to LTV (loan to value ratio). In general and i really do not want to preach on this subject of Good and Bad. A good Whole of Market mortgage broker who works for him/herself will do a good job.
I do however have and extreme dislike as to the antics of certain Capital Mortgage brokers (London) who do seem to bring the rest of us down and the FSA register of struck off individuals would seem to back this up. Not to say that all Capital advisors are bad.

GeorgeHowell

handytips wrote: »

Well i am a Cemap qualified Whole of Market Mortgage Advisor, and i am part of a Network George, i charge a broker fee and i also get a commission from the lender. I work mainly from referals or from enquiries left via my website. In the past i have arranged Sub Prime mortgages as well as Prime mortgages covering many differing cultures. Fact of the matter is this, you will get good and bad in any profession, however i pride myself on the advice i offer my clients, you will see all across the mortgage threads of people who profess they are able to arrange their own mortgage and then moan when the computer says NO. A good broker will know the quirks and criteria's of most of the lenders, which imo is a very important factor when it comes to selecting a mortgage for a client, as guess what. Each and every circumstance is Different believe it or not. Most of the general public do not realise that mortgage deals are banded according to LTV (loan to value ratio). In general and i really do not want to preach on this subject of Good and Bad. A good Whole of Market mortgage broker who works for him/herself will do a good job.
I do however have and extreme dislike as to the antics of certain Capital Mortgage brokers (London) who do seem to bring the rest of us down and the FSA register of struck off individuals would seem to back this up. Not to say that all Capital advisors are bad.

That's fair enough and a somewhat more measured response.

I would say that in the instance that I am referring to the advisor did not know, or did not choose to act on, the quirks and criteria of the lender. Also did not sufficiently take account of the client's particular circumstances. Even if as some have suggested the client was inclined to be economical with the truth -- and I don't know that to be the case, but can't prove otherwise -- the good advisor would ferret it out before proceeding. In the supposed post 2004 era of high standards surely a satisfactory advisor would convince clients that it's in their best interests to give the advisor all salient information rather than the whole thing being done on a nudge-nudge, wink-wink basis. It all savours to me of a pre 2004 approach, and clearly there are still a few dinosaurs out there (maybe it's only one, but that stretches credibility beyond the limit).