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Brokers slam NewBuy distribution

Lenders have been accused of giving the intermediary market the cold shoulder by offering their 95% LTV NewBuy products to only a small number ofbrokers.

NatWest, Nationwide and Barclays all launched products for the government’s NewBuy Guarantee scheme last month, with Lloyds Banking Groupplanning to unveil its products on April 16 and Santander following suit in May.

But Nationwide is the only lender that offers the deals to all brokers.

Barclays is restricting its distribution and only offering the products through brokers on builders’ selected panels and in branch, something Lloydsgroup also plans to do.

But Lloyds group says it has plans to offer its range through more intermediaries in the future.

NatWest only offers its products direct and Santander says it is still working on the details of its distribution.

Barratt Developments, one of the builders Barclays is working with, has only 14 brokers on its panel.

Adrian MacDiarmid, head of mortgage lender relations at Barratt, says: “The lenders came to us and told us what their strategy was. Barclays hasdecided that it wants to make customers understand the product which is why it has gone through a small panel of brokers who are fully engaged with the process.

“Our approved brokers are more likely to offer customers the standard of advice they want because they have specialist knowledge of the products.”

But David Hollingworth, mortgage specialist at London & Country, says: “In terms of supporting the wider broker market, Barclays has pretty much failed.

“It is disappointing, but from Barclays’ perspective it will be looking to control distribution. The different distribution methods make a mish mash ofthe NewBuy scheme and do nothing to improve its effectiveness and profile.”

Ray Boulger, senior technical manager at John Charcol, says the firm does a number of new-build transactions and that problems often occur when aborrower visits the broker to see what deals they can get but are then coerced into using the builder’s broker.

He says: “It’s a restraint to trade. There are plenty of brokers, including us, who are competent to deal with this kind of business, and it’s unhelpful to consumers.

“For Barclays and Lloyds group to restrict these deals to the builders’ panels is unacceptable.”

A spokeswoman for Barclays says it made sense for it to use brokers that the builders recommended.

Robert Sinclair, director of the Association of Mortgage Intermediaries, says: “I think it would be better if the scheme was more open but given the problems and constraints of the deals I can understand why builders wouldn’t want this.”

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  • E 13th April 2012 at 11:53 am

    Serously why do the FSA and Government hate us brokers so much. We are on the whole, more qualified than the average bank adviser, we are able to access better deals for clients… well we are being squeezed out of that but anyway.

    Limiting the brokers is BLACKMAIL pure and simple. It should be illegal. It goes against the principles of choice and fairness.

    I applied for a mortgage for a client some time ago on a great deal. A chap I had been chatting to since before he started househunting. He had been to his bank and another broker, who were ‘pushy’ in his opinion and he didn’t actually learn much from them, but we chatted and he then understood his options, fees, the process, etc, and was a happy confident chappy. He had an offer accepted on a house, I did the mortgage for him, then bang two weeks later ‘oh sorry lovvie’ says the builder ‘we should have told you that you must use our broker’ so he had to cancel my application and apply for a more expensive mortgage with them. SO SO SO wrong.

    With regard to these NEW BUY SCHEMES – they limit to their brokers because they are complex? Ok yes to a novice broker they may not be familiar with dealing with the limitations of newbuild or of the low cost schemes, S106 restrictions, etc. However to an experienced broker (so most of us) we are qualified, experienced professionals – what is the point of us being qualified experienced professionals if we are considerred incapable of dealing with such schemes? If we are that incompetent then mayble the 99% of us referred to earlier should be struck off. Pathetic!

  • E 13th April 2012 at 11:53 am

    Serously why do the FSA and Government hate us brokers so much. We are on the whole, more qualified than the average bank adviser, we are able to access better deals for clients… well we are being squeezed out of that but anyway.

    Limiting the brokers is BLACKMAIL pure and simple. It should be illegal. It goes against the principles of choice and fairness.

    I applied for a mortgage for a client some time ago on a great deal. A chap I had been chatting to since before he started househunting. He had been to his bank and another broker, who were ‘pushy’ in his opinion and he didn’t actually learn much from them, but we chatted and he then understood his options, fees, the process, etc, and was a happy confident chappy. He had an offer accepted on a house, I did the mortgage for him, then bang two weeks later ‘oh sorry lovvie’ says the builder ‘we should have told you that you must use our broker’ so he had to cancel my application and apply for a more expensive mortgage with them. SO SO SO wrong.

    With regard to these NEW BUY SCHEMES – they limit to their brokers because they are complex? Ok yes to a novice broker they may not be familiar with dealing with the limitations of newbuild or of the low cost schemes, S106 restrictions, etc. However to an experienced broker (so most of us) we are qualified, experienced professionals – what is the point of us being qualified experienced professionals if we are considerred incapable of dealing with such schemes? If we are that incompetent then mayble the 99% of us referred to earlier should be struck off. Pathetic!

  • J Moy 3rd April 2012 at 10:02 am

    Whilst not surprising, i think Robert Sinclair must be pulling the splinters from his backside – great to see the AMI supporting the 99% of brokers who cannot get access to the woolwich Newbuy Deals.. no sorry they are supporting the 1% who can – why can’t the government just put a scheme in place to help the whole property industry and not just the builders. Another pot of money wasted…

  • J Moy 3rd April 2012 at 10:01 am

    Whilst not surprising, i think Robert Sinclair must be pulling the splinters from his backside – great to see the AMI supporting the 99% of brokers who cannot get access to the woolwich Newbuy Deals.. no sorry they are supporting the 1% who can – why can’t the government just put a scheme in place to help the whole property industry and not just the builders. Another pot of money wasted…

  • T P 2nd April 2012 at 5:20 pm

    exactly as predicted. Govt. scheme designed to use tax payers money to help the builders sell at a mark up. When the FTB’s end up in negative equity, the FSA will spend another eighty million of levy money to make sure that they can never borrow so much again. You couldn’t make it up.

  • steve mcgill 2nd April 2012 at 9:59 am

    there cant be any broker who is surprised by this – new homes ‘special deals’ have always been a closed shop to the small broker – irrespective of whether a client would prefer to deal with him or not. just like most estate agency brokerages – its nothing short of blackmailing the client. The obvious implication is – ‘you dont deal with our broker – you cant buy this house’.

    it’s always been appalling – but its always been there.

    Bravo for the Nationwide – they’re an oasis in the desert at the moment.