Despite brokers investing to ensure their procedures are compliant, many fear rogue customers. Less scrupulous clients are discovering the complaints system is skewed in their favour and are looking to cash in. While clients can complain free of charge, if a gripe ends up at the Financial Ombudsman Service mounting a defence will cost brokers hundreds of pounds, even if the complaint is baseless. And the cost adds up to more than the levy to the FOS. There’s also management time to consider, plus the danger that professional indemnity insurance will rocket.In a scenario worthy of a Mafia movie it is suggested some brokers may be tempted to pay off clients rather than pay out more defending themselves. Bill Warren of Complete Mortgage & Loan Services warns brokers against setting the bar too low in trying to reach a settlement. “Clients talk,” he says. “If you get a reputation for paying out too quickly they may take advantage.” What’s going on? The FSA is trying to reassure the industry that the Ombudsman has a mechanism for weeding out frivolous complaints. A spokeswoman for the Ombudsman says it does not see a compensation culture emerging and that FOS is not a “consumer champion, automatically taking the side of clients.” But it’s hard to feel reassured. If broker’s compliance systems are rigorous, this should protect them. And those who are worried should remember the importance of logging all conversations and recommendations. If the FSA and the FOS want to avoid undercover battles there should be a shot across the clients’ bows to warn off those looking to make a fast buck.
- Top trends
A recent report by the Department for Constitutional Affairs stated that the number of mortgage possession actions in England and Wales had increased by 55% in Q3 2005 compared to the same period last year. It was also the highest quarterly figure since Q3 1993.However the increase in mortgage possession actions has not been experienced […]
BDS has announced a service for mortgage brokers through a partnership with overseas mortgage specialist Mortgages 4 You.Through the BDS contact line, brokers can access specialists in the provision of mortgage solutions for clients wishing to purchase overseas property. Mortgages 4 You has established relationships with numerous lenders in Spain, France, Portugal, Florida and Cyprus […]
Coventry has launched an improved MOREgage product range.The Societys MOREgage product is a combined mortgage and unsecured personal loan that gives first time buyers and movers the ability to not only purchase their house, but also the capacity to cover additional associated costs. With a high average house price making it increasingly difficult for first […]
If I were to observe: “It’s a funny old game, innit?” you’d immediately know I was talking football wouldn’t you? Maybe not, because thanks to West Bromwich I could be talking about the mortgage business.
In this short video, Azhar Hussain, head of global high yield at Royal London Asset Management, explains how his team balance bottom-up with top-down research in constructing multi-asset credit portfolios. Watch the video in full The value of investments and the income from them is not guaranteed and may go down as well as up […]
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