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Analysis: Intermediaries are in the driving seat

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Looking back on 2014, it truly seems to have been a transformational year for the mortgage advisory community.

To say that the MMR was a game-changer is perhaps an understatement but it now seems clear that the intermediary distribution channel is going to be the main, long-term beneficiary of the new regulatory environment.

The clearest evidence of that was probably HSBC’s decision to enter the intermediary fray. A lender that had previously seemed entrenched in direct-only distribution opting to offer its products via intermediaries was (and is) a particularly visible signal of the mortgage market shift.

Intermediaries are now in the driving seat and it looks likely that about 65 per cent of all mortgage sales in 2014 will have come via brokers. This is likely to increase further in 2015.

The intermediary sector may now begin to find its voice again and lenders will face greater pressure to find product solutions for borrowers who are currently underserved in this market.

Potential borrowers with small deposits and the high-LTV area in general should be on their radar given that, even with Help to Buy, there is a shortage of products. Intermediaries, one hopes, will encourage all lenders to review their offerings in this market and urge them to give greater choice for borrowers with a small deposit.

This year, therefore, looks likely to be very interesting, not least because intermediaries have the opportunity to exercise genuine ‘player power’.

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Comments
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  • Stuart Duncan 16th January 2015 at 6:01 pm

    @Good Mortgage Man
    I echo your comments in all respects. In terms of the comments in the article, I actually believe that the high LTV sector is well served for vanilla clients.

    The areas that really need attention are niche areas like middle-aged borrowers and those near retirement. They are being treated with great prejudice and the “Interest-only time bomb” is largely ticking as a result of lender/regulator failure to grasp that what is a golden generation in terms of pension income are being left stranded by this major shortcoming.

    They are being left with the choice between selling or re-mortgaging to equity release when products like the Halifax Retirement Home Plan were a terrific option, driven from the market-place by an over-zealous regulator and an attitude to older borrowers that is both patronising and misguided.

  • Stuart Duncan 16th January 2015 at 12:22 pm

    @Good Mortgage Man
    I echo your comments in all respects. In terms of the comments in the article, I actually believe that the high LTV sector is well served for vanilla clients.

    The areas that really need attention are niche areas like middle-aged borrowers and those near retirement. They are being treated with great prejudice and the “Interest-only time bomb” is largely ticking as a result of lender/regulator failure to grasp that what is a golden generation in terms of pension income are being left stranded by this major shortcoming.

    They are being left with the choice between selling or re-mortgaging to equity release when products like the Halifax Retirement Home Plan were a terrific option, driven from the market-place by an over-zealous regulator and an attitude to older borrowers that is both patronising and misguided.

  • Stuart Duncan 16th January 2015 at 10:26 am

    @Good Mortgage Man
    I echo your comments in all respects. In terms of the comments in the article, I actually believe that the high LTV sector is well served for vanilla clients.

    The areas that really need attention are niche areas like middle-aged borrowers and those near retirement. They are being treated with great prejudice and the “Interest-only time bomb” is largely ticking as a result of lender/regulator failure to grasp that what is a golden generation in terms of pension income are being left stranded by this major shortcoming.

    They are being left with the choice between selling or re-mortgaging to equity release when products like the Halifax Retirement Home Plan were a terrific option, driven from the market-place by an over-zealous regulator and an attitude to older borrowers that is both patronising and misguided.

  • Good Mortgage Man 14th January 2015 at 3:48 pm

    I argued long and hard that non-advised mortgage sales should be banned. To my surprise and delight, MMR actually delivered something that I passionately believe in. The ultimate beneficiaries of this are not mortgage intermediaries, (although we richly deserve the recognition and rewards this will bring), but the clients, who will get the right advice for the biggest financial transaction they are ever likely to undertake.