Cover yourself when Processing mortgages

From Ronnie Bowes

In view of the position in which several thousands of intermediaries now find themselves – and particularly after reading the recently published letter from Michael Lawrence (Mortgage Strategy, January 6) regarding his inability to pass the CeMAP exam – I must tell you what transpired when we had our annual inspection by the MCCB at the beginning of last year.

It was pointed out to the young lady (who was most understanding and courteous towards us) how we initially dealt with client enquiries as our only concern at that time was why they had come to us as we are specialists in sub-prime mortgages. We advised filtering questions were requested and informed clients how they could overcome their problems.

Having 18 years&#39 experience in mortgages, we considered Skipton Building Society could not be bettered for clean mortgages, and its associate company Amber Homeloans for sub-prime cases. In each case we either gave brochures or went through the various products leaving the choice to them. There were difficult cases which were handled by our agency, Advantage Mortgage Services in Ellesmere Port, who gave us an agreement in principle on one product only based on the information supplied.

Because we raised the question of filling in documentation which had no bearing on the problems of our customers we were told to amend our &#39terms of business&#39 letter immediately from giving &#39advice&#39 to giving &#39information&#39, which has been the case for the last nine months.

We are one of the leading brokers in the district, having an almost 100% conversion rate, which raises the question, why? Because we are what we claim to be – mortgage brokers, no insurance and no assurances. As for this idea that to give a service you must give advice, it&#39s not true providing one is confident about the products that are given in the first place – and we are.

The irony of this is that our associate is an IFA who has passed the MAQ exam, who technically should supervise us but does not know the difference between a capped and a fixed rate mortgage. In fact, he does not even want to know about mortgages.

Michael Lawrence talks about High Court action. We can give him an answer – adopt our way of processing mortgages. Also, call the MCCB in to undertake its annual inspection asking what he has to do to change from &#39advice&#39 to &#39information&#39 – though we reckon he has now &#39dirtied his ticket&#39! Incidentally, it is on record that to insist on someone passing exams when exams have very little bearing on mortgages, is a restriction of trade and is like expecting a plumber to pass solicitors&#39 exams.

What follows is an excerpt from our terms of business letter:

Status disclosure: We are independent mortgage consultants and are not restricted to placing business with any one lender. All our business which does not have credit problems, is placed with Skipton Building Society but they are not responsible for our actions. Our prime responsibility is to you, our client, as we act on your behalf. Other mortgages are placed through Advantage Mortgage Services, Ellesmere Port, who have a panel of lenders specialising in adverse credit mortgages and provide information on a suitable lender or with Amber Homeloans Ltd, who are an offshoot of Skipton Building Society, and with whom we are direct.

Level of service: The &#39You and Your Mortgagee&#39 leaflet indicates there are three levels of service. We provide “information on the different types of mortgage product” on offer so you can make an informed choice which to take.

Ronnie Bowes

Ronald Bowes & Partner