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Get clients ready for the fixed-rate crunch

Mortgage brokers should be preparing for some difficult conversations with their clients, with up to a million homeowners’ two-year and three-year fixed-rate deals set to end in the next 12 months.

After four bank base rate increases in the past 12 months, many could see their monthly repayments soar by as much as a quarter, say experts.

The FSA is clearly keeping a close eye on the sector and said in its quality of advice investigation in January that three-quarters of small brokers lack robust processes.

With this in mind, brokers might be well advised to get in touch with their clients early to prepare them for the payment shock and help them budget for it in the run-up.

Perhaps then, the FSA might realise that many mortgage brokers do provide a very valuable service to their clients and brokers should grab this opportunity to prove it.

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