I’ve long advocated the importance of mortgage brokers adding other income streams to their businesses, but there still seems to be doubts from some quarters that it won’t enhance profitability.
Presenting slides that featured our top individual advisers, leading firms and best newcomers and the figures they posted in 2012 may have gone some way to allaying those fears.
After all, protection sales now represent more than 50% of our top performers’ income. It really couldn’t be easier for advisers to take the plunge into protection sales and those who are overly dependent on mortgage business and have seen their bottom line impacted only have themselves to blame.
Another key theme to emerge from the conference was the importance of superior submissions. Our appointed representatives, and indeed any advisers in the market worth their salt, have long been aware that quality triumphs over quantity – notwithstanding the fact that the economic climate has pretty much curtailed the latter in any case. This trend will only be emphasised once the Mortgage Market Review is implemented in the Spring of next year and many lenders have already shifted their focus towards the class of submissions rather than volumes. Networks such as Stonebridge have long placed an emphasis on recruiting the right type of adviser firms rather than purely chasing number like some of our contemporaries. We will ultimately be better positioned once this growing trend becomes the norm.
What the mortgage industry has long been moving towards, and what the Mortgage Market Review practically ensures, is the eradication of any shortcuts or decisions that might be made in the advice process that are not the best they can be. Statutory regulation has long since weeded out the more unsavoury elements that used to exist in our profession, but until now, so-called ‘mortgage dabblers’ or those not fully committed to the sector have still been able to operate on the periphery.
What the new legislation dictates and what the imposition of certain qualification and professionalism standards means is that advice around home loans is set to become even more robust and transparent. Customers can therefore be even more reassured as to how mortgage brokers arrive at the most suitable product, what their motivation and remuneration is and how the whole process works as a whole.
Richard Adams is managing director of Stonebridge Group
