Lenders must give brokers the information they need

From Bill Stevenson

There has been a lot of debate in the mortgage press recently about how brokers are remunerated and how certain lenders are starting to offer retention fees. On a related point, lenders seem to have a code whereby they will only reluctantly provide information about clients’ mortgages.

In the IFA world the adviser introduces the client to the company and will then be given information on a regular basis to enable them to review their client’s position and adjust their advice as they see fit.

Now consider the mortgage adviser who places his client on a two-year fixed rate with a lender that only deals with intermediaries. The lender automatically assumes that the client be-comes theirs and that the introducing broker, having been paid his proc fee, ceases to exist in its eyes.

The broker flags up his diary to call the client a few months before the deal ends to find the lender – that only deals with intermediaries – has already sent a proposal to the client.

There are three problems here. First, lenders are not loyal to the hands that feed them. Second, we should have regular reviews with our clients as there will be changes in circumstances and we will have sold life cover which may need to be altered. Further ad-vances and changes of jobs might also need to be considered.

Third, lenders should send brokers a copy of the mortgage statement each year and copies of any correspondence relating to repayment difficulties. If we brokers want to provide ongoing advice this information is vital.

Why is it that when a client invests money with a bank it is willing to provide details to an IFA but a mortgage adviser – who has professional qualifications and will have gone through an extensive advice process – cannot readily obtain information from a lender to allow them to continue to advise their client?

I know it’s not my money that is being lent but if lenders accept applications based on my advice they should provide me with the information I need to keep advising my clients properly.

Bill Stevenson
DQML
Edinburgh