Power struggles between mortgage sourcing systems and trading platforms vying for business from intermediaries have prompted calls for an accreditation scheme to be introduced.
During the latest Mortgage Solutions Power Hour, John Malone, national mortgage manager of Premier Mortgage Services at Scottish Amicable, predicted lenders would put pressure on the Financial Services Authority (FSA) to enforce an accreditation scheme ensuring systems provide advisers with compliant documentation and access to the full market.
He said: ‘It seems trading platforms just want to put each other out of business, putting pressure on intermediaries to choose the right system. Sourcing systems are providing the same sort of service ‘ surely we can achieve some sort of accreditation. Pre-application illustrations should be a standard industry document. Software houses should get accreditation from the FSA to ensure documentation reaches regulatory requirements. It is common sense.’
Sally Laker, managing director of Mortgage Intelligence, agreed some kind of kitemarking would mean intermediaries could stay compliant and have access to online applications from all lenders ‘ meaning a fairer playing field.
‘If it can be done, it is a good idea. Each system is different ‘ there could never be a uniform design. But with regards to compliance it is essential. It could force lenders to make online applications available on all sourcing systems, meaning a fairer deal for brokers. Advisers should be able to access online applications from all lenders on all sourcing systems,’ she said.
Lenders making access to online applications exclusive to certain systems is a growing problem. If an accreditation scheme was introduced, it could dampen rumours that some lenders are trying to corner the market. This in turn could prevent the existence of a sole system, opening the market up to more competition.
Also speaking at Power Hour, Michael Bolton, head of mortgages at Birmingham Midshires Solutions (currently signed to Mortgage Brain, via its parent HBOS), said: ‘There is a good chance some lenders will only accept business from various sources. Come 2004 lots of us are thinking of the commercial advantage derived from road-blocking business from one route and routing it through another.’
He added this would also protect the consumer by guaranteeing that all business received was compliant.
However, Stuart Glendinning, director of mortgage channel at M2000, said an accreditation scheme was not the answer.
‘Mortgage brokers and IFAs judge our system by the quality of information and service they receive. If we deliver well, we’ll succeed ‘ if we don’t, we won’t. Who has the right, other than customers, to determine whether a system is good or not? There is too much regulation and interference in the market as it is ‘ without introducing some sort of accreditation for sourcing systems,’ he said.