I am a broker who is part of a network that has just been taken over, and I now face having to re-register with all the providers and new systems. As this will be the fifth time since ‘Mortgage Day’ that I have had to go through this – an average of every seven and a bit months – I feel I am well placed to comment on the nightmare effect that this has on a broker and their business.
All the network commentators say that AR is the route to take because of all the extra paperwork dealing with the regulator. Thinking about it, they are bound to say this aren’t they? I agree that there can be many benefits to being part of a network, but who can put a price on how many man hours are lost when having to re-register with providers, attend induction courses, and get used to new systems? There is also the thorny subject of trail commissions on general insurance being lost upon transfer.
I’m worried that as a result of the ‘credit crunch’ there will be a significant increase in network consolidation. Most networks were set up to act as a distribution vehicle for their packager, which then subsidised the running costs of the network. If the amount of business reduces by as much as some commentators are suggesting, this is going to force quite a few networks to look for other networks either to merge with or take over. There’s nothing to say that the networks who are owned by financial institutions may decide that having a network in their portfolio does not suit them anymore.
If this means that I am faced with the prospect of re-registering on average every seven months for the foreseeable future, I, for one am starting to think that the DA route might be a better proposition after all.
Yours sincerely
Mark Sutton
All Status Mortgages
