There’s been a lot of talk in the trade press recently on the value of mortgage advisers compared with the role of price comparison websites, and comments from advisers on Mortgage Strategy Online show the strength of feeling around the issue.
But this debate raises interesting questions about the direction in which the purchase of mortgages and other financial products is heading.
Everyone has an opinion on this subject and mine is that for 99% of mortgages can or should be bought over the internet.
All consumers should have access to advice from a qualified mortgage broker to ensure they get the right mortgage at the right rate for their circumstances.
The introduction of price comparison sites and the easy access the net gives consumers to product providers threatens to turn many financial services into commodities.
But while some simple financial products such as car or home insurance may be suitable for online price comparison and purchase I don’t believe a complicated product such as a mortgage can or should be bought over the internet.
It’s not the same as buying a book or a piece of garden furniture. Arguably, many people buying car or house insurance have little idea about whether they have the best product for their needs.
Borrowers should have access to advice from a qualified broker to ensure they get the correct deal
If they make the wrong choice with their cover products the difference in cost may add up to a few thousand pounds.
On the other hand, if someone makes the wrong choice about their mortgage and can’t meet their payments the consequences could be life-changing.
While this may sound perverse coming from a representative of a firm such as Leadbay, which has grown out of the evolution of the internet, we don’t believe that just because consumers find information that appears conclusive they necessarily know enough to make an informed decision.
Of course, there are exceptions to this but having been a financial adviser myself I think the internet can take consumers to a certain point and after that, the only way to ensure they have the right product is to get advice from a professional.
There’s no point in fighting the internet as it’s a battle none of us can win.
The web’s influence over our lives becomes more pervasive every day and it can do a lot of good for our industry and consumers. But surely, this is the time for common sense to rule.
It’s time to recognise the benefits of the internet and the role it can play, but also that it has limitations.
Basically, the web can play a valuable role in providing borrowers with a basic understanding of rates, mortgage types and the companies involved – both lenders and advisers.
And hopefully, online access will also furnish consumers with questions to ask their advisers.But one thing’s for sure – the fundamental role brokers play simply can’t be replaced by technology.