Three in four brokers finding business difficult since regulation
The findings come from an Alliance & Leicester (A&L) Mortgages independent broker survey. Compared to results found in its previous ‘100 days into regulation’ research, brokers experiencing decreased profits rose to 58 per cent, up from 44 per cent. The majority (77 per cent) felt being an intermediary has become more difficult since regulation.
It also suggested appointed representatives (ARs) find it the most challenging with 82 per cent saying it is more difficult compared with 72 per cent of those who are directly authorised.
The research showed over half of brokers (51 per cent) are still spending more time on maintaining business levels and more (53 per cent) now say Key Facts Illustrations (KFIs) do not provide a real benefit to the customers.
Mehrdad Yousefi, head of intermediary mortgages at A&L, said: “Previous research by A&L into the effects of ‘Mortgage Day’ showed brokers were struggling 100 days after regulation, especially with sustaining profitability and dealing with a more lengthy sales process. It is clear from our research findings that a year on brokers still have some genuine frustrations and many are still experiencing problems.”
London-based sole broker Roy New said: “The figures seem pretty fair. Regulation has been a major factor but it also doesn’t help that the economy isn’t in the best shape and the first-time buyer market is still so bad.”
Noel Ranson, proprietor at NSR Finance, commented: “Regulation has had nowhere near the alleged impact on business levels expected. Lenders have experienced the major issues as many didn’t have the systems in place to deal with it which has been reflected by poor levels of service.”