Mortgage Solutions has polled brokers on why it is so difficult to attract new brokers to the mortgage industry.
Why it so hard to attract new brokers to the mortgage industry?
Almost a third (31%) of respondents suggested that advisers were simply too time poor to devote their energies to training new recruits, while more than a quarter (26%) said the industry was failing to promote advice as a career. Wages are also a concern – according to almost one in five (19%), new starters leave, put off by the low starting salaries.
A question of timing
David Sheppard, managing director of Perception Finance, said that time constraints are a definite issue for smaller brokers, adding: “The concern can also be that you take the time to train up a broker and they subsequently leave once they get to a point of being able to add value, either to a larger firm or set up on their own.”
Rachel Lummis, mortgage adviser at xpressmortgages, agreed, pointing out that “finding time for the onboarding process” is a challenge for small brokerages.
She continued: “With a small business it is the current employees that will do the initial training. As their workload will normally be at a high level, finding the extra time that’s required for the new employee is a huge challenge, especially in the first weeks.
“We have just recruited a new employee; it meant that I had to work the whole of the Easter weekend in preparation for their arrival. We will have to wait for a period for them to settle in to the business before we take on a further employee. As much as we would want another new recruit straight away, we have to wait; our responsibility is to give 100% to our current clients and the lenders on the existing pipeline of cases we are working on, and there are only so many hours in the day.”
The same as it ever was
Sheppard argued that the financial services industry has “never done enough” to promote a career in advice, suggesting it is no different today than it was 20 years ago.
He continued: “More needs to be done to encourage people to enter the financial advice sector but even then that may be a harder sell than you might think. For most, a career in finance comes from starting in banking and progressing from there and I think that may always be the case.”
Nonetheless, the National Association of Commercial Finance Brokers (NACFB) has won praise from the industry for its apprentice scheme which it launched in 2015, which is designed to bring in new, young talent to the industry.
Networks can do more
Sheppard believes networks can play a greater role in encouraging fresh blood into the mortgage advice sector.
He said: “Most networks charge per adviser in each firm and can often charge higher fees when they are in training which is counter productive and certainly does little to encourage recruitment.”
Uncertainty doesn’t help
Stuart Gregory, managing director of Lentune Mortgage Consultancy, said that the uncertainty in the property market is also putting the brakes on recruitment.
He explained: “To many mortgage advice company owners, who may look to expand in the future see the continual regulatory upheaval and an uncertain property market – which I feel plays a huge part in decisions made not to encourage more into the industry.
“When you consider there were over 30,000 mortgage advisers in the industry a decade ago, and probably around a third of those still involved now, it tells its own story. Brokers are working harder than ever, for the same levels of commission income as in 2007 – so, with increased regulatory costs year-on-year, I can see why numbers haven’t increased.”
