Mortgage adviser numbers could swell 10% post RDR

Simplybiz Mortgages chief executive officer Martin Reynolds says there could be around 1,000 more mortgage advisers in the market after the Retail Distribution Review hits on 31 December 2012.

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Under RDR rules investment advisers will no longer be able to charge commission and will also need to achieve a minimum level 4 status in terms of their qualifications.

If existing advisers do not meet these standards they will not be able to make personal recommendations to retail customers from 1 January 2013.

Reynolds argues that RDR will have an impact on the mortgage market even if core regulation doesn’t affect it .

The pattern over the last five years of shrinking adviser numbers could be set to reverse, with IFAs either not continuing with investment permissions post January 13 or temporarily suspending their permissions until they achieve level 4 status.

He says: “The current number of mortgage advisers is approx 10,500, we believe that this number could increase by anything up to 1,000 during 2013 as the post RDR market settles downs. With mortgage lending looking likely to increase next year we could also see a return of more competition within this sector.

“More competition means an increase in marketing and consumer awareness of the role of mortgage advisers and the benefits of taking advice. This can only be seen as a positive sign for our market.”