The needs of directly authorised advisers are changing and become more complex as regulation increases, lenders demand for quality grows, and the requirements on advisers and their clients increases.
In the day to day operations of helping clients get a mortgage, advisers often need more hands on assistance in dealing with lenders, insurers and the FSA in order to be in the best position to do so.
That is not to say that directly authorised intermediaries want to become an appointed representative, far from it.
However a business partner that can supply, on either a menu basis or as a whole package, IT support platforms, compliance support, access to training and development academies, in addition to the traditional mortgage club services of speedy payments of procuration fees and exclusive products are the mortgage clubs of the future.
The biggest difference will always remain that while a mortgage club offers DAs an increasingly broad range of services, the commercial and compliance risks lie firmly with the directly authorised adviser, where a network takes on the regulatory risk for those who are authorised representatives.
The improved services on offer are having an effect however, and an increasing number of DAs are now showing more loyalty to one or two clubs as they increasingly want and expect more assistance with training and competency as the market tightens up.
This is understandable as some lenders choose to offer their products only through a network where they have a much greater control over the quality of business they will receive.
It has more recently become apparent that the FSA are expecting lenders to have vetted their customers. Many of the networks have been subject to more intrusive questions on their processes, recruitment policy, annual fitness and propriety checks.
As a directly authorised intermediary you may be expecting the FSA’s requirements and checks to suffice, however this is not going to be the case.
The FSA appears to be asking lenders to police their customers, the challenge now for mortgage clubs is whether they can step in and help brokers and lenders alike, to satisfy the FSA they do indeed know the people who are transacting business with them.
David Copland is LSL director of mortgage services
