Clear direction within the mixed Market Study

The first is that the regulator is very keen on brokers researching from a broad range of lenders when looking for a product for their clients.

Being able to document such an approach should therefore be an important consideration for brokers – not just to demonstrate compliance, but also to appear strongly in the intermediary comparison tool that the FCA has recommended is introduced to help consumers to choose an adviser.

Within the Market Study, the regulator says: “...information about intermediaries’ services should clearly show the extent to which an intermediary uses a broad or narrow range of lenders and products."

The FCA also put great emphasis on the role that technology can play to deliver tools that make the mortgage process easier, both for consumers and for intermediaries, and there are a number of sections within the Market Study that reference the development and use of new tools, including the following passages:

“New tools could be consumer-facing or could support more traditional methods of sale. We know that some consumers value telephone or face-to-face advice and a tool for use by an intermediary could complement that.”

“Analysis by the working group has identified a range of information that is already shared through existing tools such as mortgage and criteria sourcing systems. This includes product information and, increasingly, some eligibility criteria. However, information about a lender’s approach to affordability and risk appetite, and its approach to credit scoring, is not widely shared.”

The good news for brokers is that the development of tools to source information will naturally make it easier to consider and compare a broader range of lenders, as well as providing a clear audit trail. So, in many ways, the solutions to these two recommendations go hand in hand.

We recently launched one such tool, called MBT Affordability, which helps brokers to research more of the market with one easy to use affordability calculator. Brokers have access to a single, well designed, calculator that automatically and intelligently completes the individual lender calculators and collates the results. There are no approximations or estimates as the approach ensures 100% accurate affordability results every time. The platform also keeps a record of all cases and affordability results, providing an automatic compliance audit trail that demonstrates the best affordability research. Case details can be amended at any time and affordability can be re-queried. Whether case details have changed, or brokers want to research the impact of clearing a debt.

There may be mixed messages within the Mortgages Market Study, but there are also clear indications of the direction the regulator is taking. By choosing the rights tools you can ensure you follow that direction and your clients, and your business, could benefit as a result.