These concerns appear to be holding up the decision-making process for many brokers, with only ten per cent of those surveyed clear on which path to take – DA or AR.
73 per cent of mortgage brokers expect some new networks to collapse within the first year of regulation, leaving brokers adrift and unable to trade without a Principal or service provider. Nationwide Building Society is just one major lender that has admitted to a cautious approach to business from young networks.
Stephen Maskens, manager of MGM Home Finance, commented: “A broker should satisfy themselves that there is sufficient capital backing to a firm along with good regulatory experience, that the terms are acceptable and just as importantly, that they feel happy with the ethos of the company.”
The survey also revealed that 14 per cent of brokers remain undecided about whether to be independent or tied – with some unaware of the 30 April application processing guarantee deadline from the FSA.
The survey also showed that 89 per cent of brokers expected their income to rise or remain the same after regulation, with a more professional image and fewer mortgage brokers to compete for business cited as the main reasons for this.
