Being a mortgage broker is not easy. I have seen things from both sides of the fence having worked for two high-street lenders before entering the field of independent advice almost a decade ago.
When working for a lender, you do not realise how insulated you are from the wider world – that is unless or until you speak to a broker.
In my six or so years with a “broker-friendly” lender, I dealt with mortgage brokers every day. We processed their applications in-house and, imagine, I even underwrote the mortgages as well.
This was, of course, following a very detailed training regime where we were encouraged to view every mortgage on its own merits and on a common-sense basis. Therefore, if a potential borrower was renting for a period of time before applying, and if the mortgage payments were less than their rent, we had the ability to take this into account.
It sounds logical and it was – until “affordability calculators” came in, along with new-fangled credit systems which told you how much the client could afford. That was the beginning of the end of the boom as lenders offered fast-track processes for PAYE applicants, effectively offering them self-cert mortgages. That issue will rear its head when interest rates rise and it is one the FCA should prepare itself for.
When it comes to brokers, and since I started my own company in 2008, I now appreciate the different approaches towards commission by the lenders.
But are they treating us fairly?
How can some lenders pay out commission within seven days of completion while others will not pay it until the middle of the month following completion?
I understand their business reasons for doing so but it is simply not fair. And to be honest, we brokers should not accept it either.
If you have worked on a mortgage case for six months, you should expect to be paid promptly.
So lenders, here is a new abbreviation for you: TBF – Treat Brokers Fairly.
Stuart Gregory is managing director of Lentune Mortgage Consultancy