Moneysupermarket.com’s analysis of the top mortgage deals on the market will hardly come as a surprise to most brokers. The price comparison website points out that nine of the 10 best deals are available only direct from lenders, and goes on to question whether intermediaries can now justify calling themselves whole-of-market.
Of course, mortgage brokers are the last people who need to be told about dual pricing. In the boom times this was in brokers’ favour, with all manner of exclusives offered for a market geared around volume. When the market turned and funding headed south lenders restricted access to products and the slow distribution provided by branches suddenly became a virtue.
But enough with the history lesson. Behind the gloomy statistics stands an equally illuminating set of figures from the Council of Mortgage Lenders. As Moneysupermarket.com well knows with its roots as a broker sourcing system, 63% of mortgages were distributed via brokers in Q1 2010 and a whopping 71% of first-time buyer deals went via intermediaries.
Consumers want advice and help with the biggest financial commitment of their lives. The self-serve mortgage market has never set the world alight for this reason. And brokers inform clients about cheaper deals that are available direct. But like a boomerang many of these clients come back, having being disappointed by the service they receive.
Consumers use brokers for the service they provide because in this era of neat products for squeaky-clean clients many struggle to find a deal. So brokers still provide a way to make the home-buying dream a reality. Given the sorry state of the current market, that’s likely to continue for some time.