View more on these topics

RMARs may be waste of time

Brokers may be wasting time and money completing their Retail Mediation Activities Returns because the Financial Services Authority is unable to fully use the information collected.

Michael Lord, head of the Financial Services Authority department responsible for supervising small mortgage firms, says common errors in the RMAR means it doesn’t have enough assurance about the quality of the data to use it fully.

He adds: “Common errors include firms saying they are exempt from professional indemnity insurance and capital rules, as well as getting their numbers wrong.”

One industry source says small firms hate the cost and man hours required to fill in the RMAR.

The source says: “Some firms can’t afford to take two weeks off from seeing clients so they just make it up.”

RMARs are submitted twice a year and cost firms around 500. They include information on fees, complaints data, training and competence.

Terry Pritchard, managing director of packager Chase UK, says: “It’s difficult for the FSA to get a proper picture of where small firms stand financially because their management accounts, which they base the RMAR on, won’t necessarily be up to date. Therefore, while a RMAR may be an honest account, it’s not a true reflection of the profit of a firm.”

John Malone, managing director of Premier Mortgage Service, says that when the FSA designed the RMAR it may have be-lieved that many directly authorised brokers would join networks. Since this has turned out not to be the case, he questions whether the regulator will have to revise the RMAR by using the information lenders collect on intermediaries.

However, Lord says the quality of the RMAR forms is improving as firms get to grips with them and the FSA is working with brokers to help them get it right.

Recommended

edeus agrees partnership with Savills

edeus, the new mortgage lender set to launch in September 2006, has agreed a strategic relationship with Savills Private Finance as its first national brokerage.Savills is the specialist financial services division of Savills PLC, the UK’s largest property consultancy business. Savills was launched in 1997 to offer advice individuals on complex, six-to-seven figure mortgage arrangements. […]

Proposal could see number of IVAs soar

The number of individual voluntary agreements is set to soar next year under government plans to introduce Simple IVAs. IVAs are seen as an alternative to bankruptcy whereby debtors agree to pay a proportion of their debts to creditors. Typically, this is at least 25%, with an agreed payment every month. But banks have just […]

Cultural shift could see lenders working together

The industry is moving towards a cultural shift which will see lenders working together to gain competitive advantage, says Frank Eve, managing director of Frank Eve Consulting. Eve says that technological advances are breeding a generation of lenders that will work together to make life easier for themselves and brokers. He says: “Lenders are starting […]

Make base rate rise work for you

An interest rate rise can bring in new business and also provide an opportunity for informed brokers to demonstrate the value of advice to existing clients, says Drew Wotherspoon

Newsletter

News and expert analysis straight to your inbox

Sign up