why you should REALLY support brokers

BrokeRage

I am actually feeling more positive....some of the dual-pricing seems to be easing and I am now actively telling clients that I cannot recommend direct deals with some lenders as their service is simply shocking, Woolwich being the worst in my view.

Even with the clients' consent, they refuse to communicate with me at all and ignore requests for contact from me AND from the client! The first case I did is now 2 weeks in and nothing has happened at all. No point in having a best-of-breed non-advised direct deal if you can't deal with the volumes.

I would now add that you really need a broker if you want a decent level of service from the lender.

homer_j_3

I still believe that we should be asking the FSA to make the lenders put their direct deals on sourcing systems. Even with no commission payable, at least you have the option to say, this is the best deal.

Its then the choice of charging or offering the advice for free in hope that you will get some income from the deal somewhere now or later down the line.

We can then either download the app from the website and assist or we can send to the branch - either way, we can still bring benefit.

Ian_Griffiths_Halifax

I had an existing client in a couple of weeks ago who was with the Abbey. I knew they had a better Direct Deal retention product than I could get him and we made the call to the lender to arrange it.

I made the call and asked the "Adviser" to speak to my client to obtain permission to deal with me. He spoke to the client and got his permission, but he then went on to ask him more questions to establish the type of mortgage the client wants. This was going on for 5 minutes and were all Yes/No questions and I eventually asked for the phone from the client and spoke to the guy my self. I said, "look, what the client wants is the 3 year Fixed at X% and £? arrangement fee. Will you please provide a KFI and the appropriate documents for the client to change to this deal", the Adviser said he would do so and 2 weeks later the paperwork still hasn't arrived with the client.

The client is fed up of waiting and asked me to chase them up.

I called the Abbey again and let them know that they have authorisation to speak to me and the guy (different Adviser) said they need the authorisation every time I call.

I told him I understand the need for authorisation despite the fact that they already have it, but all I want them to do is chase up the paperwork for the client, not speak to me about the case.

In a rather smug tone he said again "We need authorisation from the client to speak to you every time you call".

I went back to the client and he's now going with another lender. He doesn't want to deal with a lender who won't do the simple job of sending out something they should have sent 2 weeks ago.

BrokeRage

I totally agree....homer_j, but it should be the FSA saying this, not us. They are, after all, the "Independent Watchdog" of the industry.

From their website:

Statutory objectives:

market confidence: maintaining confidence in the financial system;
public awareness: promoting public understanding of the financial system;
consumer protection: securing the appropriate degree of protection for consumers; and
the reduction of financial crime: reducing the extent to which it is possible for a business to be used for a purpose connected with financial crime.

I honestly believe that they are failing in the third objective and, as stated recently, the vast majority of complaints are against lenders, not brokers. The public do need protection and they do need advice, but they are being bribed by lenders to avoid advice and the FSA is failing to insist that lenders follow an appropriate sales process when dealing with customers. It's bonkers IMHO.

Tiddler_2

I think we all know the reason why the lenders won't agree to that though homer - they want the customers sat in front of them so they can sell,sell sell!! It's bad enough that companies such as the Halifax still phone your customers to sell them General Insurances, even though you've told them you've already arranged the cover!

As tough as we have it (and we do have it tough) I feel equally sorry for the small Estate Agents, one of our lead providers has stopped trading in sales and moved to concentrate on lettings, after cutting costs back as much as possible over the last couple of months by getting rid of staff. E.As still have the expenses of advertising, signs etc to pay for their sellers

I also think that the price gap is closing on the dual pricing, but have again had to tell a customer to stay put as better on the SVR than changing to a new deal at this moment in time.

BrokeRage

and, as for Data Protection, it is the most-used excuse since....well, since excuses were invented.

Dan_Collins_2

Talking of data abuse, we had a large, very large lender poach a client away from our channels to direct channels!! We shall be reporting this to our rep and I am sure it will up set a few.

MortgageMamma

the whole situation is ridiculous. Never mind the FSA failing point 3 Brokerage. They have failed quite seriously on all 4 points. Financial crime has never been a rife as it is now. The public are not proactively being made aware of the channels of advice and the advantages and disadvantages of each of these channels, nobody has confidence in the system - brokers and IFAs reputations have been destroyed and the questionable advisers are still on the loose, they are not protecting the public they are purely compromising them by not doing anything about dual pricing - they can't even get their own website using the definitions that they have created- some of what I am saying is backed up by the response I received from Lesley Titcombe, Head of Small Firms at the FSA following a letter I sent to them last week (published earlier in this thread)

See below

Dear Lisa
Thank you for your letter of 26 May, which you also copied to Sarah Wilson.

Your letter raises the possibility of a new compulsory disclosure leaflet as part of every mortgage sale. The purpose of this, as I understand it, would be to offer an expanded explanation of the different sales channels and services that may be available to the consumer.

As you recognise in your letter, firms must already give out an Initial Disclosure Document early in every sale. This disclosure addresses both the scope of the service the firm offers, and if the firm will give advice. The design of this disclosure reflects earlier consumer research. The focus on a few key topics is a deliberate attempt to reduce the risk of information overload. However, the existing format does require both a simple explanation of what the firm offers, and the alternatives that a consumer may seek out from others. Though market circumstances are changing, both these elements remain relevant in our view.

While we have no plans to introduce a further mandatory disclosure, you might like to know we already publish a leaflet on 'Getting financial advice' which covers the issues you identify, as well as several other topics. This leaflet is freely available to consumers, and it is also open to firms to give it out if they wish. The leaflet is available on our website from the following link - http://www.moneymadeclear.fsa.gov.uk/pdfs/financial_advice.pdf.

Finally, you mention in your letter a reference to ‘multi-tied advisers’ on our website. We don't use this term on the main Moneymadeclear pages, but it appears in the explanatory text within the Compare Products section of the site. For the mortgages table we are looking at changing the text so it follows the form of the initial disclosure made by mortgage firms.

Thank you for letting me know that your letter is in the public domain - I have no problem if you wish to make my reply public too.

Yours sincerely


Lesley Titcomb

Lesley Titcomb
Director, Small Firms and Contact and Sector Leader for Retail Intermediaries and Mortgages

homer_j_3

I thought they may direct you to the money made clear site and documentation. With no compulsory requirement to issue this and with the ability to put a sales spin on the IDD, I feel that these issues have been brushed over.

That said, they have done this probably because the implementation of the IDD, and the standard KFI's were to try and make the information consistent and in what was deemed a clear format for clients. Your request/suggestion was asking to add more information and impossible for them to even contemplate, which may be right or may be wrong.

I know personally speaking, I cannot see the implementation of such a leaflet making 1 difference because its too late by that point and there will be a sales spin added to it somehow - just as there has been with the IDD when its given and discussed.

With looking at the remit of the FSA it is clear that they are failing when we measure them in this instance but I do not think its fair to make the impression that the FSA has not changed the industry for the better in a lot of areas.

We can all make arguments for the pros and cons for example - consumer protection could easily be argued brokers should be driven out because a small minority will lie and cheat and act fraudulently and help the consumer get around the protection that should be provided. It could equally be argued that the banks are using the dual pricing as the sole aim of selling expensive insurance products.

Anyway, well done MM for putting your concerns across and I would take away from the fact that you have highlighted some issues that have been taken on board - albeit not the ones that are most important to you.

Graeme7777

It seems to be that mortgage advisors have a number of "natural" avenues into which they can diversify. I would have thought that secured loans were a close fit, or other ways of helping people with their finances?