The curse of payment protection insurance seems to be haunting the industry at the moment.
For secured loan brokers the PPI threat is becoming as big as the one posed by a lack of lending. Angelo Trapasso of Magic Loans summed it up when he recently left the industry, saying that even if he had been able to place business he would have been killed off by PPI complaints.
This is not necessarily because Magic was in the wrong by selling it but because of the current onslaught on PPI providers.
Just this week Which? announced that it is launching an online Payment Protection Insurance complaints tool, aimed at making it quicker and easier for people to claim back mis-sold PPI.
The facility even allows consumers to select their provider from a drop down menu, fill in some questions and off the complaint goes.
Brokers don’t stand a chance against these kind of methods.
On top of this claims management firms are also starting to beef up their advertising in the national press. Some of the ads I have seen look more like product recalls as oppose to claims management firms.
The Ministry of Justice has promised to come down hard on firms that are making false promises, but there seems so many of them cropping up you have to wonder how it is going to banish all of them.
The most worrying aspect of claims management firms is that they will always be here, even when the credit crunch disappears and lenders return to the market the claims management firms will still be there lurking in the background.