I am sure that CP146, the FSA's approach to regulating mortgages sales, has proved to be very interesting reading for everyone involved in the mortgage industry.
The deadline for responses was, of course, today, but its being issued on the August 8 ensured that we all had the best-seller just in time for our summer holidays. And for those of you who enjoyed the gripping CP98, there should have been no major surprises.
The consultation focused on the mortgage sales process with further documents due in Q4 2002 and December 2002. The news of potential additional qualifications will no doubt thrill the numerous advisers who are still to attain one of the new mortgage qualifications.
With the introduction of the Prometric electronic examinations for CeMAP now available at 150 centres throughout the UK with results being issued on the day, advisers may be lulled into a false sense of security, feeling they have more time to prepare and sit the exams. Forget it.
The pass mark has increased from 56% to 70%, coupled with sectional fail now being possible and at least 50% of marks being required in each part of the paper.
The deadline of December 31 2002 is looming ever closer, so studying must now take priority.
Nevertheless, the qualifications are welcomed across the industry and I am confident that the grading of the 'lifetime mortgage' as high risk, with the potential for the additional qualifications in this specialist area, will also be seen as a positive step within the industry.
While we await FSA decisions, one thing is certain; the industry will see some challenging and significant changes over the next couple of years. Whatever the final outcome, the cost of the new regime, along with the increased requirements in training and competence, will force mortgage advisers to take a good look at their position in the industry – and to look for support from elsewhere within the industry, possibly a network.
It has long been agreed notion that you cannot be a 'jack of all trades' – you have to find a niche within an area in which you would like to specialise, then outsource other activities. Networks have developed to be able to offer a professional advisory and support service, not only in compliance, but also marketing, sales, training and development and business development.
With networks come a wealth of knowledge and experience in demystifying and deciphering regulatory legislation. Couple this with their close working relationship with the FSA and you find that they can show us the way through the red tape jungle by the provision and issue of workable information and guidance by way of:
Procedure and compliance manuals
Standard templates for fact finds and other processes
Information on developments within the industry
Training and competence schemes
So what else should you expect from a good network? Well, a knowledgeable and experienced helpdesk can prove to be an essential support mechanism to advisers.
A network's aim for its advisers should be to provide them with sufficient accurate documentation, advice, information and support to enable them to provide their clients with suitable recommendations. Timing is of prime importance, so turn-around times and performance should be determined and measured. Speed is as important as accuracy; a good network can balance the two.
Networks should also be able to negotiate with lenders and other product providers consistently competitive procuration fees and commissions. A good network should be able to provide advisers with a good back-office infrastructure; one that can efficiently support fee reconciliation, as well as problem-solving for any issue relating to payments.
Training has always been a significant focus of the networks. Most offer extensive training and development programmes, starting with an induction aimed at testing the individual's fact-finding and presentation skills, their knowledge of the Mortgage Code, of products and terminology and at ensuring that they are aware of all the requirements on issues concerning disclosure and documentation.
It is a requirement of the Mortgage Code Compliance Board that all registered mortgage advisers have a responsibility to 'maintain competence' by way of continued professional development. What's more, records and evidence must be kept in order to demonstrate and verify this.
Networks are able to establish, tailor and introduce new training and development programmes and events, either specifically for individuals, or for larger groups.
Networks can also play a significant role in marketing your business to current and future clients, and it needn't be a time-consuming task, given the right support. Promotional support such as adverts, mail shots, editorials and helping develop strategic marketing plans can all help you to target the right audience and generate more business.
Currently in the UK, there are over 15,000 advisers reaping the benefits of being part of a network. Really, can so many advisers be wrong?