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Networks and clubs should push FCA to pause or reduce fees, brokers say

  • 26/03/2020
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Networks and clubs should push FCA to pause or reduce fees, brokers say
Asking the Financial Conduct Authority (FCA) to temporarily waive or reduce fees is one of the biggest ways mortgage networks and clubs can support brokers through the Covid-19 outbreak, brokers have said.


Rachel Dixon, founder of RH Dixon, said her network already approached her saying it made contact with the FCA to see if this was a possibility for its members. 

“I’m surprised they’ve mentioned this so soon, it must mean they have had a few queries come through from broker firms,” she said. 

However, she noted it was understandable as some brokers may be concerned about having to still pay indemnity and membership fees even during a slowdown in business or contracts not completing. 

She added: “I’m good for a while and I have quite a big pipeline but if they don’t complete then I won’t get paid. I’ve already had a £450,000 transaction fall through, so I can see how something like that might be a problem if it happens to other brokers.” 

Jo Jingree, mortgage adviser at Mortgage Confidence also said it would be good if fees could be suspended but said it was unlikely to happen. 

Additionally, Dixon referenced how an industry-wide change in working patterns could still end up having knock-on effect for brokers who were in a comfortable position like herself. 

A slowdown could be caused if surveyors and valuers aren’t able to go out and do their job. If construction workers aren’t working on sites then properties won’t be ready in time and mortgages on new builds will fall through if the mortgage application deadline runs out,” Dixon said. 

A number of lenders have already made the call to suspend physical valuations in compliance with the current lockdown. 

To further assist brokers financially, Andy Wilson, director of Andy Wilson FS, said networks and clubs needed to keep on top of payment services so member firms get paid at the earliest opportunity. 


Consistent updates 

Updates on industry changes was also suggested as a way brokers could be supported by networks and clubs.

Mike Owen, mortgage adviser at Diverse Advisers, said this would be particularly helpful in giving brokers one place to see relevant information instead of looking up each lender site. 

He also said updates on the insurance industry were important as the sector was a “movable feast”, with terms changing on a regular basis. 

“People are assessing their own mortality now so it will be nice to get a clear view of the various insurances,” Owen said. 

Jingree added that her network was already doing this and said it was helpful during this busy time when advisers were trying to keep a clear head. 


Digital support  

Many brokers are already accustomed to working remotely but greater technological support was suggested as a way to assist particular functions such as meetings and identification checks. 

Andy Wilson, director of Andy Wilson FS, said guidance on the best video calling platforms would be welcomed so advisers could still provide a “friendly face” to clients. 

“I have always shied away from dealing with clients in any way other than face to face, but with the prospect of a lengthy lockdown period, this has to change if we are to survive,” he added. 

Owen went further and said if advisers were going to have face-to-face meetings with clients through video calling platforms, there needed to be guidance on how they could continue to verify the identity of clients. 

He said: “It’s one thing being able to speak to clients on platforms like Skype but it’s not always that easy to verify that they are who they say they are compared to when it’s done in person. Maybe the government can relax some of the money laundering laws to allow for this.” 


Business strategy 

Although social distancing has meant many industry events have had to be cancelled, Wilson suggested how technology could be used to continue these events which can be instrumental in an adviser’s business development. 

“With network organised seminars and meetings being cancelled, it would also be useful to see networks organising more webinars, where they bring in outside speakers, again in a virtual sense,” Wilson said.  

Jingree suggested networks and clubs provide marketing support to help firms deal generate leads ahead of a possible industry slowdown. 

She added: “It would be good to learn new ways to bring in business for those who may be worried about their streams of income.” 


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