The Which? Financial Services operation sent out a note to its key partners today, which has been seen by Mortgage Introducer.
Which? Mortgage Advisers and Which? Insurance Advisers are set for closure, subject to a summer consultation with members of staff.
The Which? Financial Services operation sent out a note to its key partners today, which has been seen by Mortgage Introducer.
The note said: “As a result of a recent internal review of Which?, we have taken the difficult decision to propose the closure of our mortgage advice and protection insurance advice activities.
“This decision has only been made after much deliberation, and has not been taken lightly.
“Once the Which? teams have been briefed, there will then follow a full process of staff consultation.
“At the end of this process (around mid-July), we will be in a clearer position to know whether the closures of our Mortgage Advisers and Insurance Advisers businesses will go ahead.”
The note added: “It is important to stress that nothing will change before the formal consultation period has concluded.
“As such, it will essentially remain business as usual for the next two months. Should anything change we will come back to you with further information.”
Ray Boulger, senior mortgage technical manager at John Charcol, said: “Which? started off as a fee-free broker, realised that wasn’t viable and hence moved to charging fees but presumably found it challenging to generate an adequate return.
“I think one of the challenges for brokers in the next few years, now 5-year fixes have taken over 2-year fixes, is there is going to be less remortgage and product transfer business.
“Flat purchase activity is also a trend that will continue making the market challenging.”
Jonathan Burridge, development director at JLM, compared the proposed closure to his own experiences as a broker at Quantum Money, which was forced to close a decade ago owing to the global financial crisis.
He said: “It is terrible to see a business face closure and the impact that it will have on all the staff who have worked hard and given their best for many years.
“It is an experience that I and many others went through a decade ago.
“However, the fact is the market is buoyant and there are many networks, like us, and our AR firms that are on the growth path and who would welcome conversations to explore opportunities with the talent within Which?.
“From chaos and uncertainty comes great opportunity and the future can be bright.”
A Which? spokesman said: “We can confirm that we have today announced proposals to review the future of Which? Financial Services and are sadly proposing to close Which? Mortgage Advisers and Which? Insurance Advisers.
“We will now enter into a period of consultation with our employees. No final decisions will be taken until this process has taken place.
“While the consultation is underway, business will continue as usual, and we will continue to deliver the quality of service that our customers would expect.”
