Cemap and bad credit

dunstonh

MM, the problem with generalisations is that there are going to be exceptions.

Unfortunately, people short of money have in the past been more inclined to rely on commission bias and sell more expensive products that generate a higher commission. Indeed, just look at the recent articles that indicate that as much as half of sub prime mortgages could have been done with mainstream lenders at a fraction of the cost (and a fraction of the commission).

Its not just those that need money that do this though. Salesforces with league tables where the top performers need the business to get their incentive or where there are sales managers giving them grief for not earning enough.

That doesnt make all sales force advisers bad but I wouldnt get advice from one. I would also "prefer" to get advice from an adviser that doesnt have to worry about their income.

Harold shipman was a murderer. Does that make all doctors murderers? No. However, in financial services it appears one bad apple makes us all bad apples.

MortgageMamma

fair point Dunstonh, but I still think wealth and credit history is not a reliable way of judgeing the integrity of someones advice. At the end of the day, you could sit in front of an adviser in a big plush office, with a bentley parked outside, who has a huge house and expensive foreign holidays and designer suits, and at the end of the day he COULD have the same financial problems as someone who earns less and lives more modestly.

I just don't know how bad credit can fit into this as, as I'm sure you know someone who has bad credit is not necessarily hard up (some are I appreciate that). If a bad credit history has been established, and it can be clearly evidenced that the person has paid off whatever debts they had then surely that is a sign of a good character as they have fulfilled their obligations to their creditors when their circumstances permitted?

Commission bias in my opinion is a thing of the past. we are all highly regulated. our networks do product spread checks and we all have bto justify why we have selected a particular lender. The commission we receive a proportion of is clearly identified at the back of a KFI for the client to see, and on the whole commission on mortgages is pretty much the same across the board.

In our profession I accept we are in a position of trust, but you have to add balance to the commission bias arguement with the fact that there are advisers in the industry who wouldnt dream of ripping a client off or giving them anything other than the best possible deal for the sake of a few extra quid. There is way too much negativity towards financial and mortgage advisers in general from the media and the public, but it is even worse when advisers turn on eachother and accuse eachother of being dishonest and lacking in integrity. What sort of impression does that give the public? If we think so little of eachother and make rash presumptious judgements about another adviser just because they are not wealthy or with A1 credit score, are we not in danger of doing this to our clients?

At the end of the day, it is the character and principles of an adviser that is of the most importance and I believe you have to be fair and act in the best interests of your clients to stay in this job for any length of time as we all rely on referrals and repeat business.

I really cannot comment about those people within modern day sfinancial salesforces, but I'd like to think that they are not as bad as other advisers who have the priviledge of being independent, whole of market and self employed like to make out.

MARVIN_2

I know the truth story about one American investment banker who became a successful millionaire after 2 times being in bankruptcy and now he is teaching high profile business people.
So may be it is the fastest way to learn on our mistakes?

MortgageMamma

Maybe, like I said it all depends on the character, attitude and principles of the individual involved. You have to have certain skill sets to do this job, the most important one is acceptance of others and the recognition that whatever financial position they are in, if they are sat in front of you they are relying on you to sort them out and do the right thing by them. If you do come into the industry I would give you just one piece of advice....

If you do the right thing by your clients, your clients do the right thing by you!