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Critical problems for principals

With days to go before statutory mortgage regulation, we cannot but think we told you so. As long as two years ago, we the undersigned constantly told our lender panels, the industry and journalists of the likely outcome as to the number of firms becoming directly authorised (that is, 70 per cent of mortgage intermediary firms) but still requiring the help and support of a mortgage club.

Amazingly, some very big lenders have been predicting – and still are – the absolute opposite, that is, that approximately 70 per cent of mortgage intermediary firms will become appointed representatives of a principal.

Most principal firms have built their cost structure around signing up a certain number of ARs. The new principal networks are now likely to reduce in significant numbers as they find that, without the required critical mass, their income will not be achieved and their financial position will not be sustainable.

Maybe mortgage intermediaries have been smarter in their decision making than the FSA and maybe the FSA should not have issued so many grants of permission to networks.

John Malone

Managing director,

Premier Mortgage Service Mortgage Club


Nvesta – Secure Multi Tracker Plan 2

Type: Guaranteed equity bondAim: Growth linked to the performance of the Dow Jones Eurostoxx 50, S&P 500 and Nikkei 225 indicesMinimum-maximum investment:3,000-2m,Isa 7,000Term: Six yearsReturn: 105% of the average growth in the indices at the end of the termGuarantee: Original capital returned in full regardless of performance of indicesClosing date: December 17, 2004, December 10, […]

Firms failing authorisation can trade on for a year

Mortgage firms which fail the FSA authorisation process can continue trading for another 12 months while they wait for an appeal. Under a Treasury ruling, mortgage firms applying for authorisation which are turned down by the regulator will be able to continue trading as interim authorised while they wait for a tribunal hearing. Although firms […]

&#39Multi-tie commission gap will be unsustainable&#39

Falcon Group chief executive Allan Rosengren has questioned the sustainability of a future distribution system where multi-ties receive higher commission than IFAs. He was speaking at a debate on the future of the IFA at Money Marketing Live in Bristol this month. Rosengren was joined by other leading IFAs from the South west – Kilminster […]

Positive rating in poll

Berkeley Independent and Positive Solutions are the IFA service providers most highly rated by members, according to research from Henry Samuels Marketing Services. Highest-rated networks are Berkeley Independent and, although not strictly a network, Positive Solutions, tying for first place with a rating of 4.3 out of five. Burns Anderson is second with 4.1 and […]

US loan growth is not painting a pretty picture for the US economy

Written by Mike Riddell One of the current big debates in global financial markets is whether investors should believe ‘hard’ rather than ‘soft’ data, where the usually reliable business and consumer surveys have been suggesting strengthening in global growth momentum for some time now, while the economic data that feeds through into the Gross Domestic […]


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