Mortgage Angels managing director Nat Daniels said: “It is becoming more apparent that there is only a finite amount of business out there that will not sustain the present numbers of lead generation firms.
“There are new entrants coming into this sector almost every day competing for the same business and cutting margins to the bone in order to do so. Many of these firms come to market via the internet. But now the big banks are moving into this space forcing the price of advertising on this medium up and up to a point where some smaller lead generating firms will be forced out of business.”
Those firms competing on price alone – and that have been forced to pare their service down to the bone – are most at risk. Advisers have already begun deserting them citing poor service and dead-end leads as their reason for leaving.
“It is true to say that we have seen a number of advisers that we had lost to some new entrant firms rejoin Mortgage Angels to obtain good quality leads and service. The newcomers are now being squeezed between a reducing broker base and shrinking operating margins so consolidation is inevitable and we are well positioned to take advantage of this opportunity to develop our own business should an appropriate opportunity arise,” adds Daniels.
