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Majority of brokers to go direct

by: By Paul Robertson
  • 17/11/2003
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While more than half of mortgage brokers have opted for direct authorisation under Financial Service...

While more than half of mortgage brokers have opted for direct authorisation under Financial Services Authority (FSA) regulation, many remain undecided on what lender panel they will use.

According to a survey by The Mortgage Business (TMB), 45% of brokers are set to choose appointed representative (AR) status. Of the 55% who will become directly authorised 30% are unsure of what panel to use.

The majority of those becoming directly authorised will be taking on ARs – 63% intend to sign up to 25 ARs, 27% between 26 and 100, and only 11% more than 100. And while 79% of brokers intend to solve compliance issues through a central desk or a sourcing system, only 13% intend to visit ARs.

Bill Dudgeon, managing director of The Mortgage Business (TMB), said: “Compliance would appear to be an issue for brokers probably because it can be time consuming and a lengthy process. However, it is interesting that there is an almost 50/50 split between becoming authorised and appointed.”

A similar report from Networkone found 47% of brokers intend to be responsible for their own compliance – nearly a third will use an in-house compliance officer, 17% will use a third party, with the rest undecided. As regards costs, 40% have so far spent over £1,000 on future regulation, with 12% spending over £10,000.

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