Becoming an Independant Mortgage Broker

[James1974]

Hi,

I am currently looking for a little advise in relation to a new business venture. I was hoping that someone would be kind enough to offer me some advise?

I have just started planning towards my mortgage broker qualification and things are going well. We already have an established business so this is a new side venture. Clients wise I have a few useful contacts in the estate agency sector so all is looking fairly good there.

However, once qualified I wish to go independent but I have no idea whatsoever about what software a mortgage broker needs to be able to conduct their business.

Is there software or a website where I can compare mortgages for my customers and make the applications for them? Any advice of guidance would be really appreciated. I assume I need to purchase some kind of package?

thank you for your time.

 

[garyk]

My wife is a mortgage broker, not independent she works for John Charcol and she uses mortgage brain which I think you can use as an independent too.

What I would say however is working for a large broker means they take care of the compliance and admin side of things which is pretty substantial. Even chasing everything from required documentation from prospective buyers to getting updates from solicitors can be very painful and something you will have to do on your own.

 

[James1974]

Thank you for your help

 

[tony84]

The easiest part is passing the exams.
The hardest part is obtaining CAS. You need to have someone who will monitor you for 6-12 months and then sign you off as competent. You can only get that by working for another broker/another firm/or opening up yourself under a network.

However, with no experience there are only maybe 2 networks who would look to take you on - new leaf and ingard (there may be others but I do not know of any). They typically help you with your compliance and provide all of the sourcing systems for a cut of your turnover, as a neww starter it will be around 25% of whatever you earn although that comes down in time to around 10-15% in time.

The term independent has changed recently and it actually means that you can provide advice on mortgages and secured loans...The FCA and EU have changed the meanings so many times that it gets confusing and when you actually explain the difference btween independent and Whole of Market to a customer they do not mind whether you are independent or not as most are not looking for a secured loan.

Dont worry about setting up on your own directly authorised by the FCA just yet as it will not happen (you will not be allowed). I have just been signed off by the FCA to go it alone (rather than under a network) and it took 6 months, £7 grand (although I do get some of that back in time), about 60 pages of form filling and 200 pages of reading...stick with the network route, at least initially. It gives you a good grounding and you still get to call yourself james1974 mortgages and you are self employed so you can work when you want, it is 50/50 in that you are kind of self employed but you have a few rules to follow.

Alternatively you could find a local broker you can work with - the benefit here is that it is a lot more personal than a network and when you have a nightmare case (which will be every case when you start for the first 6-12 months, you have someone to ask for help). In 5 years I have not come accross a single customer like they are in the books. Nobody is as perfect as those customers. Some have late payments, on matenrity leave, income made up with bonus/OT, 4 kids and you need to use child tax credits, self employed etc etc.

As the saying goes, do not run before you can walk. You will find the support that another broker or network brings invaluable and although you see 25% as a big cut (I did when I was where you are now) it actually isnt for what they will provide. Financially you will only be worse off when you are writing about £30k a year, but not massively. You need to be writing in excess of £40k for it to be worth going directly authorised - but again, as soon as you go directly authorised you lose the help and support you get from others.

I was in your shoes 4-5 years ago, I wanted to be where I am now back then, but I am glad I had people around me to help and also introduce me to account managers, I have contacts now that I would not have had had I just jumped the gun.

ITs a cracking job, but it is stressful with all of the rules and regulation that come with it. I never quite realised how much there was until I applied to go directly authorised.

 

[James1974]

A big thank you Tony84 as that's really helpful

 

[RFrayling]

I was going to pop a post here, but Tony84 has absolutely hit the nail on the head. Very solid advice, and worth listening to!

 

[James1974]

Thank you very much for the advice It's really nice for you all to offer such good advice.

 

[Deleted member 53208]

Once you get Competent Adviser Status (CAS), just send us a contact form via our website and we can have an informal chat or look at which suitable networks are currently out there?

Which Network

 

[tony84]

If you do go down the network route, it is worth getting in touch with Gary (@Which Network ).
I have not used his service personally but he is well known in the industry.

 

[Glyn Edwards]

Hi

This thread has compelled me to register as I'm partially interested in becoming a registered broker but my situation is different to the one above.

I'm currently CF30 registered with the FCA, working as a Wealth Manager with Full Statement of Professional Standing (SPS) to undertake regulated financial advice. I do not have any mortgage advice qualifications and I'm thinking of taking some in order to become qualified.

Given my background will I need the 6-12months supervision still or will this give me some sort of leg up to being able to offer advice quicker?

Lastly I do appreciate the need to use a platform for this type of work and would wholly agree with what has been said above in that regard. Given the complexities the business I work in has with MiFID II, having the network provide some compliance help is only good!

Thanks for your comments.

 

[tony84]

You still advise prior to having CAS, the supervisor just checks everything you do.

I imagine as a financial advisor you will be checked a bit more than a Mortgage advisor.

 

[wesdav]

With regards to systems I recommend 'the key' this integrates the sourcing system 'mortgage brain' and is a full on/off line fact find and also integrates the suitability letter and has a great reporting facility.

with regards networks you could speak to mortgage intelligence or tenetlime, both of which are very good.

best of luck!

 

[Liv Williamson]

Hi,
Sorry to jump in on someone else's post.
I have been a mortgage advisor/broker with an estate agency (part of sequence/Connells estate agency) previously before having my children. I worked for them for a number of years and loved my job. Unfortunately they do not have any local branches to return to (I used to travel 50 miles each way and now would rather not!)
I would like to get back into the industry, I have had a break for 6 years now .... I still have a fountain of knowledge I can put to use, and will need some time to get up to date with new criteria and policies.... But am not sure how to go about setting up myself.
I am CeMap qualified and gained competent status within my old job....although I do not have any paperwork from them that I am aware of...... would I need to re-do anything now it's been a few years?
Ideally I want to work on a self employed basis for myself, although not DA as I can see that's a longer/hard route.
I want to work on My own timetable as and when I want, so I can work around my children still. I'm not planning on wanting to write 40k a year (just yet!) .... just take it steady while I settle back into it and build up business.
I'm assuming working under a network is probably the best option....
Has anyone had similar experiences and how have you got on ?
Many thanks

 

[tony84]

Just seen the post above by Wesdav - I take the complete opposite view, I hated the key and mortgage brain is probably the worst of the 3 major sourcing systems out there. But each to their own.

Liv - I think you would struggle to go DA at the moment anyway so a network or working under an existing DA firm are probably the 2 options open to you. Speak to Gary @Which Network they can probably point you in the right direction of a network open to you.

Based on your expected turnover and lack of CAS at the minute, I would expect you to be paying away around 20% of turnover. My advice would be to look at your options, dont go with the cheapest just because they are the cheapest and dont take what the networks tell you with anything more than a pinch of salt. I worked under 2 networks, one was small but very personal, the other was large and was a little more glitzy with bells and whistles but when it came to compliance they were not very good.

Dont dismiss working with a DA firm though. Having someone on hand to help with placing business will probably help no end. A LOT has changed in 6 years, I have been a broker for 5 years and when I think back to when I started, there are lenders who no longer exist, new lenders to market and companies who have changed the type of business they accept.

You will probably notice a MASSIVE difference in BTLs now.

 

[Liv Williamson]

Many thanks Tony! Fantastic response and very much appreciate it!
I'll have a look for Gary @ whichnetwork and see if I can come up with a plan to slowly get myself back into things.
I've been a self employed childminder since leaving "work work"... and am now desperate for some intellectual stimulation.
Many thanks again
Liv

 

[tony84]

and am now desperate for some intellectual stimulation.

So your not going to be speaking to the lenders directly then?...Ill get my coat

 

[Liv Williamson]

???? Well I'll be calling lenders and my old bdm's (if they are still around) to get up to date with policy and criteria changes .... But no I'll not be calling them for work.... I don't want to work directly for a lender. ... I need to be able to be flexible.

 

[tony84]

Sorry, that was my attempt at a joke.

You want some intellectual stimulation...so you wont be talking to lenders directly.
Half the BDMs/call centre staff I speak to do not deserve their jobs they can be that useless. There was a lender who questioned some bank statements as they thought they were fake due to no transactions on the 24th/25th/26th of...December.

 

[Liv Williamson]

Ah haha, sorry should have realised! Was in a serious mood last night thinking things through. In a few years break I've obviously forgotten how ridiculous their requests can sometimes be..... looking forward to getting frustrated with them again in the future lol.
Haha....seriously....99% of shops closed on Christmas day and someone isn't using their card ....shock!!
Well it's all flooding back to me now....... children.....or .... solicitors and underwriters ....

 

[Broker87]

Hi all,

Reading all the above post has been very interesting and informative.

I was wondering if anyone could provide me with some advise. I am qualified broker who has recently received a panel removal from high street lender. Due to this the network i was currently with can no longer keep me on as a broker.

Speaking to a few people within the industry, I was advised to go directly authorised or join a brokerage firm that is directly authorised as this maybe my only option to start writing business again.

Has anyone been in a similar position before or know someone who has?

Thanks