Retail branch advisers hold the title of mortgage adviser, and even did so before many of them were qualified to give advice – so why not mortgage intermediaries?
The debate around whether to change a job title may appear to be arbitrary but if it is sending out an unclear message to the public about the level and quality of service being provided it is definitely one worth having.
This week’s panel of experts look at the value and meaning of the job title mortgage broker and consider whether it needs to be updated or if it accurately reflects the modern day intermediary market.
Robert Sinclair, chief executive of the Association of Mortgage Intermediaries, says that while we shouldn’t get hung up over labels the term broker remains an accurate representation of the skills intermediaries used in finding the best mortgage for their clients.
Neil Hoare, commercial director at Homeloan Partnership, reflects on how today’s borrower may struggle to relate to the term broker but argues the title adviser under sells the role.
Colin Chapman, director of Genesis Financial Services, considers the differences between the role of the mortgage broker and the in branch mortgage adviser in his analysis of the relevance of the job titles.
Robert Sinclair is chief executive of the Association of Mortgage Intermediaries
Whether we label ourselves as mortgage brokers, advisers, sellers, consultants or managers, it probably does not matter to the average consumer who is just looking for an expert to point them in the right direction.
What is important is that whoever the customer sits in front of, they have an abundant quantity of current market knowledge and combine this with a superb quality of advice that then determines the customer experience.
In real terms, firms broke mortgages by bringing two parties together. Consumers who have insufficient knowledge of the market are matched to the most appropriate lender. This activity is exempt from VAT.
To do this individual advisers use their well-developed skills, within the regulatory confines and framework to determine best fit. It is the skills of fact finding and knowing which lenders will meet the needs of that customer that matter. This is the role and we do not need to get too absorbed in terminology.
Perhaps we should just see firms as brokerages who employ advisers to deliver results and the best of these are outstanding professionals. What has become clear in recent weeks is that many lenders have almost given up on advice and the intermediary professional is holding sway.
Our market share continues to swell. Lenders will come back with new technology based solutions, in the first instance for retention, however it is up to the broker community to ensure that their customers come back to them for advice first.
Neil Hoare is commercial director at Homeloan Partnership
Having worked in the insurance industry for several years it’s interesting to see the term ‘broker’ has been replicated in the mortgage world.
Since the advent of MMR it seems the role of the mortgage broker and insurance broker have become closer than ever before – presenting customers to a business partner based on an analysis of an appetite to take a risk of claim or failure to repay the loan on time.
So for those of us of a certain age, we understand the role of the broker in financial services having used one in the past for our car or home insurance. But for the next generation of homeowners and landlords those accustomed to buying insurance on-line, the term broker may not have any modern day relevance with so many purchasing decisions for financial services based on price rather than risk.
And of course brokers tend to get remunerated solely through commission, the advice fee isn’t a natural fit in the mind of the customer in a broking relationship. So should we be mourning the passing of the broker and celebrate the rise of the adviser? Well the term adviser probably doesn’t go far enough with the quality requirements from lenders. It’s not just about the advice to the consumer, it’s about how the case is then packaged, the credit quality of the customer, the ability to spot fraud, and the eventual performance of the loan.
So what should we call the modern day intermediary or broker? Well, until we dream up an single word occupation code similar to solicitor, accountant or doctor then we will have to settle on a professional mortgage adviser.
Colin Chapman is director of Genesis Financial Services
The mortgage broker title might be outdated, or not reflect truly the value and service that we provide, but I think now more than ever the mortgage adviser/intermediary/broker/professional is more important than ever to both sides – lender and customer.
The work load placed on brokers continues to rise, hopefully further lenders will recognise this and increase proc fees in the coming months. Growth is clearly going to come via the broker channel. Branch advisers think they are busy if they do two to three cases a week.
From my firm’s perspective, client’s much preferring to deal with brokers rather than go direct to the bank. Every day we get a call from someone new having been recommended by a previous client. The flexible model we offer, emails out of office hours, evening and/or home appointments stand the broker community well ahead of the nine to five the most banks operate under.
The clients, I do not think, really care what your title is. They want and need help and guidance with a mortgage. The advice extends beyond the mortgage to also offer advice about protection too. I think it’s fair to say that despite the ever evolving technology age, there will always be a desire by the customer to see a face or speak to the adviser in person.
As long as you know you are doing a professional job, ultimately, the title is largely irrelevant.