Consumer advertising tricky for brokers, claims PR

The mortgage industry – particularly those operating in the sub-prime market – is finding consumer advertising problematic under the Financial Services Authority regime, claims Llewellyn-Slade PR.

However, the firm says intermediaries and lenders wanting to use public relations as a marketing tool can do so without fear of the impact of mortgage regulation.

This is because, unlike advertising, PR falls outside the FSA rules.

Mark Llewellyn-Slade, managing director of L-S PR, says: “Some mortgage advertisers are finding the new APR rules difficult to incorporate.

“In particular the new from, to and typical APR requirements are more complicated.

“Its definitely making life more difficult for the sub-prime players. But PR allows them to talk about products without worrying about APRs. Used responsibly, its a powerful alternative.”

In the Financial Promotions section of the mortgage rules, MCOB three, the FSA is clear about the type of promotions that it regulates (qualifying credit promotions) and explains how firms can ensure they are compliant.

A key consideration for advertisers is ensuring that an authorised person signs off all qualifying credit promotions.

However, PR is impossible to police, as the organisation sending the information to target media, often in the form of a press release, has no control over the exact content or wording of any resulting article.

This is because the article is based on the journalists interpretation and stance on the issue and often contains input from third party commentators too.

Paul Griffin, of Bradford based mortgage broker SmartMove, says: ” We have done a dozen local radio interviews across our northern heartland over the last few weeks.

“Im being invited to comment on mortgage regulation and how the consumer will benefit. I also have a regular slot in a national Sunday newspaper providing mortgage advice.

“This type of exposure enhances the reputation of my business as well as raising awareness and generating leads in a way that traditional advertising cant, as the consumer knows that advertising is simply paid for propaganda.

“PR not only falls outside of FSA regulation, its usually cheaper than advertising too, so its a win / win situation all round.”