Need to give a Rant

jonewer

Mmmm... With the exeption of senile or otherwise mentally handicapped people, its hard to have sympathy for people who are too lazy to know when they will be reverting to SVR.

Although I can understand that it may be distressing to have to deal with such people and their problems, I cant help but feel a strong degree of bitterness to those on £18k who borrowed £190k. Its because of them that we currently have an entire generation priced-out of home ownership.

And yes, I know the lenders are also to blame, but its in their nature. Its what they do. Raging at lenders for money-grabbing predatory mis-selling is like raging at the sea because people drown in it.

Crazy_Saver

poppy10 wrote: »

To be honest, I have little sympathy for those to ignorant to read the small print before making one of the biggest financial decisions of their lives.

Ouch!!

We can't tar all borrowers with the same brush just as we can't tar all FAs and Lenders with the same brush either.

A lot of borrowers (especially first time buyers) are young, or excited at buying their first home, or settling down for the first time and are probably not as wordly wise as a lot of older, more cautious people.

They don't have the financial 'savvy needed when it comes to mortgages which is why they put all of their trust in their FA, IFA or lender. I'm sure most of us can look back with hindsight and wish that we hadn't made stupid mistakes in the past.

I know that 19 years ago when we took out our first mortgage, my husband and I believed everything the advisor told us without even thinking to question her. Very similar to the way that many people put doctors on a pedastall today. In our eyes, she was the professional and obviously knew best. We just signed where she told us to.

Of course today, I read all the small print, question everything and do a lot of comparing before I even consider signing anything.

Please don't think that evryone that gets caught out is lazy or ignorant.

No offence meant

Regards

Crazy Saver

wisbech_lad

Uhm, by definition they are lazy and/or ignorant You yourself say you made a stupid ignorant decision in the past, and so have I (over a savings bond)

But if you learn from the mistake - that's progress.

Dan_Collins_2

Still mortgage paperwork is not that complicated. Its put down in plain english, more so these days. If they sat down for an hour and went through the biggest step they will take in their lives they may have saved a lot of hassle and pain!

I am not saying that everybody should be financial wizz kids but at least if they read it they would not the rate is not fixed etc etc!!

Conrad

The public deserves better. The issue really is one of culture, the mortgage 'advice' culture is a sales culture.

If you attend a conferance for dentists you do not find promotions to win a bemarrrrrrrrrrr.
The sales culture typicaly rewards volumes rather than quality, numbers of CIC plans sold rather than income partly linked to long term claim outcomes.

I often hear packagers say to brokers "if you put the clients on x scheme, you get double the proc fee'!!

The whole industry culture harks back to bygone age of door to door insurance salesmen, a defunkt, backward looking model.
And before any salespeople (you are not advisers in the main, you are salepeople with a soft spot for flash cars) complain, just ask yourself this question;

DO YOU ADVERTISE / TELL POTENTIAL CLIENTS YOUR SERVICE IS 'FREE'?

Or do you say "free, but I will try and sell you lots of insurance cover as that earns me lots of money which pleases my network / manager"?

Crazy_Saver

wisbech_lad wrote: »

Uhm, by definition they are lazy and/or ignorant You yourself say you made a stupid ignorant decision in the past, and so have I (over a savings bond)

But if you learn from the mistake - that's progress.

Point taken wisbech_lad.

I have definately learnt from it (a zombie, low cost endowment) although the learning process has cost me many thousands of pounds:o

Plus I must also admit that the system as a whole has become a lot more user friendly over the past decade. There are a lot of procedures in place today purely to safeguard the borrower that were not around when we were starting out on the housing ladder.

I was quite happy believing that it was all down to my growing wisdom that I understand most of the paperwork related to my finances - alas it is probably down to the fact that it is all written in plain English to enable us "ignorant" folk to understand it better;)

Regards

Crazy Saver

homer_j_3

Conrad, I believe you are correct that advice and sales are difficult to split as a broker in terms of you give the advice but profit from it so how can it be deemed that you have been given a fair crack.

You will probably feel that fee based is the way to answer that. Do you have to sell your fee or do you explain why you charge it (is there a major difference between explaining and selling in this instance)

I believe for once your post has some merit worth discussing.

How do customers understand whether its really advice or a sales pitch they are being given.

We cannot tar the whole industry of fee free brokers in this manner as I believe it crosses over into the fee based advisers too.

Are some fee based advisers charging fees well over what the commission would have been received if they had just taken the commission. Where fees exceed commission and the client has to pay and cannot afford it, do you have to sell the ability to add on to a mortgage which accrues interest and increases debt?

Lets imagine the FSA have made it compulsory for all mortgage advice to be administered on the true independent model of fee charging/commission rebate basis.

Would you not have to sell why your advice costs more than one of your competitors. Everybody sells in this job. You are trying to say that just because you are getting the advice for free, the broker will always sell to their pocket and not to the clients needs.

They only way this would work is by breaching every competition rule out there and say that all brokers must work in a uniformed manner to a uniformed fee and under no circumstances can any broker deviate from this

To be fair Conrad

Its a big debate this AND one that I would welcome.


P.S are we both not selling the difference in operating models?

Dan_Collins_2

Conrad wrote: »

The public deserves better. The issue really is one of culture, the mortgage 'advice' culture is a sales culture.

If you attend a conferance for dentists you do not find promotions to win a bemarrrrrrrrrrr.
The sales culture typicaly rewards volumes rather than quality, numbers of CIC plans sold rather than income partly linked to long term claim outcomes.

I often hear packagers say to brokers "if you put the clients on x scheme, you get double the proc fee'!!

The whole industry culture harks back to bygone age of door to door insurance salesmen, a defunkt, backward looking model.
And before any salespeople (you are not advisers in the main, you are salepeople with a soft spot for flash cars) complain, just ask yourself this question;

DO YOU ADVERTISE / TELL POTENTIAL CLIENTS YOUR SERVICE IS 'FREE'?

Or do you say "free, but I will try and sell you lots of insurance cover as that earns me lots of money which pleases my network / manager"?

Conrad does it again!

I agree with some of what you say, however you cannot tar all of us fee free brokers with the same brush. Although I dont charge a fee (fee paying options available blah blah) I work on a referal basis and cannot afford to give bad advice. As you know in 95% of cases insurances are or will be good advice! Just so happens that the more insurance the client takes the more I earn! Our whole practice and many other we deal with work on this basis!

However, I worked with a practice that charged a fee and worked on a sales basis more than advice. Fee charging IFA's and brokers are also guilty of this and it comes from the old IFA's and door to door salesman. Disturbing was rife and commissions high. The practise I was with had ties to allied crowbar! I say no more on that matter!

You are also correct to say lenders do not care and come up with strange reasons to use them. They come out with strange takes on criteria and services. They look at you very strangly when you tell them I will go with the best deal for the client and not for the better commission! Also I have a friend that was a medical rep 3 or 4 years ago and they gave all sorts away including a Mini!!

What I dont like is the fact you always find a way to start your fee or fee free obsession! Are you doubting your self??