Whittaker suggested that in the buy to let market brokers’ are becoming more advisory and that they should no longer take a simple transactional approach to their customers.
And he warned that relying on product transfers could put firms “under pressure”.
Speaking at The Specialist Lending Event 2019, Whittaker noted that the product transfer market could be as much as 15 per cent of buy to let transactions this year.
While Whittaker welcomed the increased availability of product transfers he warned brokers that replacing remortgage commission of 45 or 50 basis points with a product transfer at 25 basis points could have serious effects.
“I had a thought that some of your business models and back offices are going to come under pressure for the same amount of work that you’re doing,” he said.
“This worries me.”
Move-away from transactional payments
Instead, he urged brokers to form longer more in-depth relationships with clients and that lenders should reward their work in this regard.
“I really believe that your role is moving to advisory rather than transactional,” he continued.
“And there will come a point where the lending industry has a grown up and joined up conversation with the broker industry and says how do we set our stall out so we move away from solely transactional-based payment to something that links to the life of the loan?”
Noting that other lenders may not appreciate this stance, Whittaker continued: “But this is the grown-up conversation that needs to happen and we need to change our mortgage industry.”
And he hinted that Keystone may be one of the first lenders to adopt such an approach.