Brokers’ market share is set to keep growing as more consumers seek their advice on the back of the MMR
Mortgage brokers ended 2015 with a market share approaching 70 per cent. This is a rise of 5 percentage points from the previous year and a huge increase of 20 percentage points since the credit crunch.
It is clear that more consumers are choosing to take advice from brokers on the back of the MMR. As such, the majority of new lenders are looking to deal almost exclusively through brokers, while a number of existing players that previously provided a high number of mortgages directly are also sending serious amounts of business in that direction.
While I am sure this situation will not continue indefinitely, I am confident that brokers’ share of the market will rise again this year. Currently, most lenders are investing as much in their broker channels as they are in their consumer channels. Yes, a number are developing new direct-to-consumer systems, but these are likely to take some time to complete and get off the ground.
So in the meantime the most efficient and effective route to market remains through brokers – and particularly through networks. Indeed, networks give new lenders a safe route to market, providing them with the knowledge that the quality of business will be monitored and that ongoing training and competency testing of brokers will be carried out.
And another thing: borrowers advised by brokers are more likely to have taken out general insurance and protection, making the lender’s debt more likely to be covered.
All things considered, the broker share of the market looks set to keep growing for some time yet.
Toni Smith is sales operations director at First Complete