Branches failing to sell mortgages
Share
Offering mortgages in branches is not proving fruitful for lenders, says Paul Shearman, proposition director of Openwork.
Speaking at a panel discussion on the future of networks at the Expo last week, Shearman told delegates: “The number of mortgage cases being transacted in lenders’ branches only justifies having about one adviser across three or four branches.
“The model of having bank tellers feeding leads to in-branch mortgage advisers is failing and lenders are struggling to get business, which represents an opportunity for brokers.”
Shearman also says the tide is turning against directly authorised brokers because of the amount of regulatory knowledge they need.
He told delegates: “The regulation coming out of the Financial Services Authority, such as the Mortgage Market Review, is intense - the MMR is due to be around 700 pages long. It is a challenge for brokers who are independent.”
He adds that larger lenders are starting to concentrate more on large brokerages and not individual DA brokers.
Also speaking at the debate was Gemma Harle, managing director of TenetLime. She told delegates that ongoing regulatory costs are taking their toll on how much networks need to charge their appointed representatives.
She says: “The charging structure of networks is under threat and the regulatory landscape is creating a financial challenge.”
If you enjoyed this article, sign up here to receive daily email updates from Mortgage Strategy and Follow @mortgagestrat
