This week’s letter comes from Paul Smulovitch, and his response to the article: Does the mortgage industry need more competition among networks and clubs? – Marketwatch.
He said: “It’s a big decision choosing directly authorised (DA) vs appointed representative (AR).
Make the decision to be DA and end up with reams of paperwork and costs and refusal of some lenders to deal with you if you aren’t an AR.
However, choose the AR route and after the vetting process you find your feet and then see a rapidly changing market.
There is a vast difference between networks in terms of support, back office systems and attempts at staying ahead of the game yet its only once committed that these become ever more apparent.
Yet as stated, once you are in to a network, leaving or changing is exceptionally disruptive and can have cash flow consequences.
It is the smaller networks that offer the more personal touch and forward-thinking technology but then they sometimes lack the buying power the larger offers.
Ultimately the issue with the industry is transparency and ease of change that wouldn’t be allowed in a direct to consumer market.
Most industries now have had regulations making it clear and easy to differentiate companies and leave or change, yet in the business world it’s a different rule and not considered important enough to revise.
Would we want to change our status if we could? Maybe.
Is it too complicated in a market where it takes infinitely more time due to compliance and regulatory change to earn the same and therefore less time to be able to deal with the necessary investigations, paperwork or commission sacrifices to change status… yes.”