More buyers are being pressured into using inhouse advice, he says
A ‘small but significant number’ of estate agents are increasingly breaking the law by pressurising buyers into using agencies’ preferred mortgage service providers, it’s claimed.
Karl Wilkinson (pictured), founder and CEO of broker firm Access Financial Services, is calling for the culprits to feel the full force of the law.
Speaking to Mortgage Introducer, Wilkinson further urged the industry to address what he describes as ‘unethical practices’ around protection commission.
“I would really like to see the rogue estate agents who are flouting the Estate Agents Act 1979 banged to rights,” Wilkinson said. “It’s still a highly competitive market, and a very small but highly significant minority of estate agents - who are themselves under a great deal of pressure - are resorting to the illegal tactics of discriminatory conditional selling.
“They are pressurising buyers into using their preferred - often inhouse - mortgage service provider, with the threat that the buyer could lose the opportunity otherwise. Our advisers and their clients are unfortunately seeing more of this, not less.”
He continued: “The industry also needs to think of a way to put a stop to unethical practices around protection commission clawback. This is where a customer cancels a protection policy within its clawback period, even though the commission has already been paid. I think we all need to put our heads together on this one and come up with a solution to avoid this happening. Something in the middle of non-indemnity and indemnity. It’s dragging firms into debt and bankruptcy.”
What’s the outlook for the mortgage market?
On a more optimistic note, Wilkinson believes things are looking up for the mortgage market.
“Despite a tough 2023, our advisers were busier than ever this January,” he observed. “I think there’s great relief all round that the adjustment of interest rate hikes seems to have settled and customers are starting to look for new homes or to remortgage. We’re already seeing a more active mortgage market, which will push through into 2024.
“The Bank of England’s latest Money and Credit report shows that some homeowners are finally in a position to reduce their debt by overpaying on their mortgage - £0.8 billion of mortgage debt was paid in December compared to zero in November, which is encouraging.”
He added: “That said, a lot of people are still struggling with debt. Borrowers must continue to be cautious and seek professional advice so they get the loan that suits their individual circumstances. Meantime, lenders need to maintain sensible lending policies so that the level of repossessions continues to drop. With the dark days of 2023 behind us, I think the industry will be in a much better place by the end of 2024, and 2025 will be better still.”
Wilkinson anticipates a rise in the number of those buying new build properties.
“New-build buyers should start to climb,” he reasoned. “Long-term mortgage rates should drop a little further. The downside to this is that customers are likely to be on longer-term fixed rates, so advisers won’t be able to revisit their clients within the two-year period they’ve been used to working with. As a result, advisers are going to have to work even harder over the next five years – especially if they’re new to the industry.
“On the plus side, I think the UK population will benefit from the wider skills set of advisers in general, and they’ll feel confident in taking out life insurance, for example, to help secure their families’ futures.”
Read more: Access FS teams up with Nomo Bank to offer Sharia finance
What makes a successful broker firm?
Wilkinson didn’t become a broker until his early 30s. He initially owned a restaurant in Wales, and later bought an established business from a broker who was retiring, launching Access Financial Services in 2017.
“We’ve been growing consistently and vigorously ever since,” he commented. “We’re a happy, ambitious and collaborative bunch of some 255 mortgage and protection advisers.
“My main passion as CEO is supporting every single one of our advisers – whether employed or self-employed. I am heavily invested in providing our customers with the best advice, and to do that we are deeply diligent in providing our advisers with the right training for them as individuals.
“So, for example, if you have zero experience in the mortgage or insurance industry, we’ll teach you the ropes by starting you off in protection. You stick with one single protection adviser and learn their product inside and out. At the same time we’ll teach you professional skills, soft skills.”
He elaborated: “As you progress, and for our more experienced advisers, we have the Access Academy, where you can qualify for CeMap (Certificate in Mortgage Advice & Practice) 1, 2 and 3. Plus we provide regular training for everyone in sales, cold-calling, strategy and tactics etc.
“On the sales and marketing side, we support our people on multiple levels including personal web pages and CRM. Our Trust Pilot rating is five, with some 4-500 reviews, so we must be doing something right.”
Wilkinson believes maintaining a focus on advisers is key.
“A lot of networks don’t truly have the adviser in the heart of their culture whereas we care about our advisers and openly encourage a collaborative culture,” he stated. “Our WhatsApp chat is constantly on fire with success stories, support and guidance for everyone.”
He summed up: “Basically, we love compassionate and hard-working go-getters!”
