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IFAs can pass on the mortgage business

New mortgage outsourcing brokerage firm Paradigm Consulting is to target IFAs after research revealed that about a third of intermediaries may pull out of the market because of increasing regulatory costs.

The MCCB-registered firm is looking for IFAs who do not see mortgages as a core service but who do not want to risk losing life and investment clients by refusing to handle mortgage business.

IFAs can pass the client to Paradigm which will take responsibility for the entire mortgage process, taking either the procuration fee or a split in fees based on individual circumstances.

Paradigm questioned 120 IFAs in the last quarter of 2001 and found that 30 per cent would consider pulling out of the mortgage market because of the heavy costs of regulation.

The company says this is partly due to the need to have the Maq or Cemap qualification by the end of the year and because of networks taking a share of the commission.

The research also revealed that 22 per cent of IFAs are worried they could lose valuable investment and pension business because of being involved in protracted mortgage negotiations and 43 per cent would consider outsourcing mortgage business.

Director Chris Fleetwood says: “All insurance is referred back to the IFA and the client remains a valuable asset for their future.”

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