The vast majority of advisers – 87% or almost 9 out of 10 – make use of MLOs, up on last quarter’s 84% and 79% one year ago.
However, the overall proportion of mortgages arranged via such organisations has declined gradually over the past year and a half, falling from 44% in the third quarter of 2002 to the present figure of 39%.
John Heron, managing director of Paragon Mortgages, says: “Almost all brokers make use of Multi-Lender Organisations on a regular basis, but that’s only one way by which they do business. Flexibility and choice are key in today’s competitive intermediary market.”
This quarter saw a significant increase in popularity of the Legal & General Mortgage Club, which accounted for 45% of business, up from 40% in the last quarter of 2003, taking over from Prudential as preferred MLO. Other organisations seeing increased usage were Norwich Union (up strongly, from 20% to 30%), Pink Home Loans (up from 14% to 18%), and Scottish Life (up from 3% to 5%).
Prudential saw a decline from 42% to 40%, while The Mortgage Operation slipped from 13% to 11%, the survey found.
Q1 2004 saw a slight cooling in the overall level of business activity reported by brokers, after a very busy Q4 2003, in which 32.4 loans were arranged. The number of mortgages arranged by brokers this quarter was 30.1, the same number as in Q3 2003. While it represents a decline as compared with Q4, it is nonetheless 15% higher than a year ago.
In terms of the future, mortgage advisers remain confident, expecting to do 5.4% more business in Q2 as compared with Q1. If achieved, this would bring the total number of mortgages arranged to 31.7.
John Heron explains: “2003 turned out to be a very busy year for the mortgage market, driven by particularly high levels of remortgaging as people took advantage of attractive mortgage deals. Inevitably, things had to cool off a little, and we’ve seen a slightly lower level of mortgage activity since New Year. However, as the housing market continues to pick up and people buy properties in the Spring, advisers expect to see renewed growth in their business next quarter.”
