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Definition of independence for mortgage broking

I wonder if you could help me? Until recently, I understood that the definition of independence when reading from your initial disclosure document was very simply under the regulation of the FSA and was: “We offer mortgages from the whole market”.

However I am now confused as we are a registered introducer with Alliance & Leicester. Due to their recent change in policy whereby to remain on their registered panel of intermediaries you need to submit a minimum of two applications per month. Do we need to offer a different definition to our clients?Am I therefore correct in understanding that when explaining our independence (from whom we offer mortgage products) in a scenario where it is the last working day of the month and we have not submitted any mortgage applications to Alliance & Leicester, then we should have a IDD which reads: “We offer mortgages from the whole market unless – we only have two more mortgage customers to see this month and have yet to submit an application to Alliance & Leicester – in which case we only offer mortgages from a single lender [Alliance& Leicester]”.

I would appreciate clarification of this issue as soon as possible. Maybe the FSA could offer some guidance?I am also sure we would all like to understand what Mehrdad Yousefi, A&L’s head of intermediary mortgages believes are the main challenges/obstacles and compliance issues when explaining your independence to a customer, especially when recommending a mortgage towards the end of the month. Perhaps he could explain how he sees A&L’s new policy benefiting the consumer.

Paul SmithDirectorProvident Solutions

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