Brokers must learn not to give their advice for free

Our experience of working with single brokers and large networks has shown compelling evidence that advisers must review their remuneration channels urgently. To remain viable, brokers must charge professional fees to all customers whether they recommend products with proc fees or not.

Brokers are struggling to cope with market conditions, including the fact that many direct-to-lender products are better value than the ones available to them.

Also, many customers are coming to them for advice having already looked at mortgage comparison websites, so they are aware of what is available direct from lenders but still need expert advice to find the best deals.

This means brokerages must have sourcing systems that cover direct and broker products, together with sales processes that prompt the payment of professional consultation fees and automated analysis systems that show comparative fees and costs across all suit- able mortgages.

Brokers must flag up and gain client assent to their fees at an early stage of the sales process before specific lenders have been recommended and customers potentially walk away with valuable information they have not paid for. They also need to keep clients on board so that they have the opportunity to cross-sell insurance products.

No other professional adviser would be willing to give away their advice for free and brokers must learn to do the same.

Richard Angliss

Managing director

Home Buyer Systems

By email