Bluestone’s David Torpey and Steve Seal welcomed guests, and Mortgage Solutions features editor Owain Thomas chaired the debate.
The discussion kicked off with thoughts on the Financial Conduct Authority’s (FCA) recent interim report of its Mortgages Market Study.
Broker database makes sense
Participants were largely in favour of a broker database, as suggested by the watchdog.
As well as being useful for consumers, it was suggested the database could be a useful tool for recruitment.
One participant said: “I think it would be an excellent addition… I’m all for it.
However, the Supper Club participants noted that pulling together the tool wouldn’t be straightforward.
One broker said: “I think it’s going to be very difficult to have something which covers all of the market.
“But I think it will be great, I think all of us want the guys who are high quality advisers to be recognised in that light, but I just think it’s going to be tricky to create it.”
FCA should do more to promote advice
The FCA found that commercial relationships weren’t affecting the outcome for borrowers.
At the same time, the regulator said around 30% of customers don’t get the cheapest deal.
However, the two factors could be inter-linked, according to views aired around the table, as the lenders used by some brokers are likely influenced by commercial arrangements.
One participant said: “You do see advisers, who have relationships with new build firms, under huge pressure to get those offers turned around within a full week of exchange – I think it would be wrong to say it doesn’t influence where they place those cases.”
Another participant added: “They’re not looking at every lender, or they’re not placing business.
“It tends to be the usual suspects. And, again, that’s probably time and pressure.”
It was pointed out that there are other considerations, aside from cost, when placing deals.
One participant said: “You’ve got to factor in speed of service as well. So that’s not factored in.
“I would not send TSB or HSBC if they’re stacked with business, you would go to the next best lender, so that could accumulate within the 30%.”
Another participant added: “We’ve all had experiences where there may be a great product but it’s just the service is shocking.”
Brokers at the debate argued that the FCA should be doing more to promote the benefits of advice.
One participant said: “We write out to every customer on completion with a customer service questionnaire.
“None of them talk about interest rate, none of them talk about saving me money; they all talk about held my hand, went above and beyond, service, speed, support.
“That’s what’s lacking in our industry, it’s all money focused.”
Robo advice changing the industry
Technology and the development of robo advice was an issue that generated lots of opinions at the Supper Club.
However, most agreed artificial intelligence (AI) or computers would not be able to completely replace the human element.
One participant said: “Comparison websites are right for some people. AI will be right for some people, but it will be wrong for, I think, the majority.
Another broker added: “It appeals to the younger demographic, because of the way they like and see robo advice, it’s easy and slick.
“But they still have to go through an advice process, they still have to engage with someone.
“It doesn’t go from one end of that transaction to the other completely seamlessly without any human involvement.”
Some people around the table felt the development of technology was positive for brokers.
One participant said: “I’m looking for to build my business over the next years and months and I love robo advice, I’ll take 90% of it… I’ll take the best bits.
“Clients want to use the internet to do most of what they want to do… And then they want to speak to someone because the purchase is so large.”
It was also pointed out that other parts of the homebuying process need to be improved with technology, if robo advice is to make a difference.
One participant said: “Every mortgage lender will get the offer out before the solicitor is ready.
“So who cares about robo advice? It doesn’t mean anything until the conveyancing process is streamlined.”
There was general agreement around the table that the property and mortgage market in Manchester is thriving.
One participant said: “You can’t get a mortgage quick enough in Manchester at the moment.”
Some brokers also reported an increase in the number of specialist cases.
And many of the participants talked of the benefits of helping borrowers who fall outside mainstream criteria.
One broker said: “A lot of the clients we meet, perhaps we’re not their first choice.
“They may have been to the estate agent, they may have been to the mortgage broker and they’ve been declined.
“So they’re very appreciative of the advice we give.”
Another broker added: “We get more referrals from those types of clients.”
The supper club also noted the growing importance of later life and the equity release market.
Some advisers said they were referring cases on, but acknowledged it can be a lucrative area – though it’s still dogged by outdated consumer perceptions.
One participant said: “As an industry, we need to educate people better that it’s not what it was years ago.”
Many of the participants at the Supper Club felt there are a lack of brokers in the industry who are genuinely good at their job.
One participant: “I’m being held back, not by technology, not by the FCA, not by the number of appointments, I’ve got bags of those. What I need is quality advisers.”
Some participant felt low standards were down to poor quality training in the industry.
One participant said: “You get all the younger advisers who could be great advisers, but they’re not being nurtured.
“They’re not being shown how to do the job and they’re all too reliant on the computer, the sourcing systems, the computer says no, this doesn’t fit.”
A huge thank you to our sponsors Bluestone and all the guests on the night. (see below)
Shaun Evans, Financial Experience
Jason McDonald, Beneficial Life
Lee Wilson, Beneficial Life
Jane Reid, PMS Mortgage Club
Ansar Afsar, We Know Mortgages
Jonathan Brennan, Mortgage Advice Bureau
Bluestone – sponsors
David Torpey, CEO, Bluestone
Steve Seal, director of sales and marketing, Bluestone
Jimmy Govan, BDM, north of England, Bluestone
Owain Thomas, editor, Specialist Lending Solutions
Oonagh Sheehan, commercial manager, Mortgage Solutions
Lana Clements, news editor, Mortgage Solutions