The mortgage network was bought by the Freedom Group as a distribution arm for the mortgage lender and the parent company strategically linked the two together in the past. While the sale of Freedom Lending took the industry by surprise, it has left a gap in Freedom’s business strategy, prompting speculation over a potential sale.
But Stephen Atkins, group compliance director for Freedom Finance, believed the sale of the lender made business easier for the group. He reiterated there was no question of a sale in the future, and said: “Having a lender and a network together within the group actually created a conflict of interest from the Financial Services Authority’s (FSA) point of view. The concern would be that a lender could charge very high interest rates and then the brokers would be forced to sell it. Even though the conflict is allowed by the FSA provided it is properly managed, this sale has actually strengthened our position in that we no longer have that conflict. While we’ve never had a problem, we no longer need to be concerned.”
Rumours of a potential sale were also denied by Gemma Harle, managing director of Mortgage Next Networks, who said the sale of Freedom had no impact on the network and would not lead to a sale. “There is no suggestion that we will have our parentage changed. We provided distribution support to Freedom Lending and we will continue to do so. But we are not intrinsically linked. As a good lender, it will remain on our panel. There is no intention of any sale. The sale of Freedom came about because Merrill Lynch approached the Freedom Group, so it was not planned. Its sale doesn’t impact Mortgage Next Networks at all.”
