Brokers’ fortunes have improved dramatically over the past few years.
Back in 2009, not only were firms battling to stay afloat but a lot of lenders were doing all they could to drive direct business, mainly through dual-pricing.
At that time, less than 50 per cent of mortgages were intermediated. Things were tough.
However, as we revealed last week, brokers now account for 69 per cent of new mortgages – a near-record high. Moreover, brokers’ share of the market has increased significantly in the past year, by just over 7 percentage points.
In a way, brokers have the FCA to thank for this. The introduction of the non-advised sales ban, as part of the MMR, has without doubt given the advice industry a much-needed boost. Borrowers do not want to sit through a three-hour meeting with a bank adviser who will recommend only from a limited product range.
Consumers are savvy and the Council of Mortgage Lenders’ figures clearly show how much they value independent advice.
As we revealed earlier this year, lenders are beefing up their technology to drive more customers through their direct digital channels. However, good brokers should not fear this. If you provide a good service, you could have a customer for life.
Of course, there will always be people who wish to arrange their own mortgage and they should be allowed to do so. But good face-to-face advice will always have its place and it is reassuring that consumers are aware of this.
It is hard to predict what share of the market brokers will have in the future but it is likely to be a majority.
We are living in the age of the broker. Long may it last.