The Mortgage Event kicked off again last week with two packed roadshows in Bristol and Leeds. Building on the success of last year, almost 3,000 delegates are expected to attend one of the seven regional roadshows.
With a highly competitive intermediary market and statutory regulation now just over a year away, it is perhaps unsurprising that delegates proved eager to put the industry and the FSA on the spot to answer questions about the likely impact they can expect on their business in the coming year. After months of discussion and consultation the future landscape of the market is much clearer, and it seems the intermediary sector has finally grasped the nettle and begun to make plans in earnest. Unsurprisingly a straw poll conducted among delegates has revealed that statutory regulation is still the burning issue, and while the majority believe it will have a positive impact overall, individually the outlook is still pessimistic.
But with the FSA keen to give the impression that it is not trying to force intermediaries into networks it has again been urging firms to consider the implications of direct authorisation. To this end, it announced to delegates that the application form should not prove too onerous and will mostly just require ‘yes’ or ‘no’ answers. In promoting direct authorisation the FSA has received unlikely support from the growing number of networks who are pushing an ‘all routes to market’ approach, and are offering a choice of appointed representative status or support services for those who choose to remain directly authorised.
It comes as something of a concern then, to hear reports that not all sections of the market are united in supporting intermediaries. It appears that some lenders may be trying to artificially manipulate house prices by instructing surveyors to cut valuations and, in some cases, refusing to accept independent valuations which may prove higher than their own estimate. It is unclear just how widespread the problem is to date, but with reports of this practice coming in from both ends of the country, it is not something that should be taken lightly.
While it could be argued that lenders are just trying to minimise their exposure to risk at a time when house prices are still rising, it is dangerous to interfere with market forces in this way. By constraining prices it could lead to a downturn in prices, which could be wrongly interpreted by the national media and precipitate a problem that just does not exist. Also, it does not do the reputation of advisers any good to have to keep telling clients that there is a problem with their mortgage application.
Perhaps the best option for intermediaries is to just carry on acting in a professional manner that cannot give either clients or the regulator cause for complaint.
Ben Marquand, editor