This falling trend has led to cash flow difficulties for brokers which in turn has led to a rationalisation of the sector.
With proc fee revenue about a quarter of what it was a couple of years ago it’s not surprising that many brokers have left the market, and it’s likely that more will follow.
It has been sad to see the likes of Cobalt Capital, Hamptons Mortgages and Chase de Vere leave but consolidation could be good for consumers as the firms that remain should be better placed to help them in the current climate.
Rationalisation means the remaining distributors will take a higher proportion of the mortgage market. They should be in a position to provide strong propositions to consumers.
It always strikes me how resilient, adaptable and entrepreneurial brokers are and John Charcol’s recent agreement with HSBC is a good example of this.
But with mortgage revenue dramatically down, this remains a difficult market in which to operate.
Brokers are well placed to guide borrowers through the storm and they remain central to our distribution strategy. It’s up to lenders to keep the broker sector vibrant in these tough times.