FCA finds broker revenues soaring as direct sales plummet

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Mortgage broker revenue soared by 53 per cent between 2013 and 2016, according to the Financial Conduct Authority.

The latest FCA product sales data says this equals a rise from £529m to £807m in the period.

The regulator says: “This largely reflects the increase in regulated mortgage lending via brokers over the period.”

The FCA noted that total regulated mortgage deals done through brokers were 47 per cent higher in 2016 than in 2013.

Loans made direct to consumers were down 20 per cent in the same period.

The number of regulated firms reporting mortgage intermediation revenue was static over the period at 3,800.

Many of these firms mainly handle retail investments, but do some mortgage broking.

Commission continues to be the main source of income for brokers, making up around 80 per cent of revenue earned in 2016.

Mortgage brokers made 61 per cent of their revenue from mortgage sales, 38 per cent from insurance and 1 per cent from investments.

The FCA says: “It is notable that most (91 per cent) of these firms also earn revenue from insurance mediation – typically the selling of income protection products.”