27/08/2025
IF YOU WANT TO BENEFIT FROM MORTGAGE ADVICE AND THE PROTECTION IT BRINGS TO YOU AS A CONSUMER, YOU NEED TO READ THIS POST IN FULL.
The Government asked the Financial Conduct Authority (FCA) to help boost economic growth by offering "consumer choice, removing ‘friction’ and giving (existing) borrowers more control."
In July 2025, The FCA gave the "green light" to consumers being able to arrange mortgages directly with lenders without receiving any advice. The FCA Policy Statement PS25/11 states:
"We want consumers to have more choice in how they deal with their mortgage. Our changes will make it easier for consumers to:
• engage with their mortgage provider without the firm always having to provide mortgage advice when it is not needed or wanted
• reduce their mortgage term, lowering the total cost of borrowing and reducing the balance of mortgage debt taken into later life."
The FCA goes on to state:
"We will evaluate the success of the changes through our supervision of firms and monitoring regulatory returns, including complaints data."
During the very brief consultation phase before introducing the new policy, lenders were positive towards the idea (being able to cut costs by streamlining applications by removing the need for advice, reducing affordability checks, and removing advisers from the process), whereas mortgage brokers were against such changes, partly due to commercial reasons, but primarily due to the increased risk to the consumers who decline advice without realising the implications.
If you consider a mortgage as any other purchase, you could find yourself without any recourse when things go wrong. You might have less protection than if you had bought a £9.99 kettle from your local supermarket because you didn't know if you needed advice.
Why use mortgage brokers?
Example 1 - As a quick example of why advice is so important, during the period of falling mortgage rates over the last 6 months, I recently amended a client's mortgage application, with the same lender, three times between application and the completion of the purchase, saving the client over £80 per month on their 5-year fixed rate mortgage, a total saving of £4800. Would you know that was an option?
Example 2 - A client came to me to ask if I could match the deal he found online. I offered a mortgage with a higher interest rate. The client was confused until I went through the additional costs of the lower interest rate mortgage which included higher application fees, valuation fees and the need for legal fees. Using true cost calculations, the more expensive product was over £2000 less expensive over 2 years.
Example 3 - A client had been declined by a lender with whom she banked, so contacted me. I was able to review her situation, find an alternative "high street" lender and secure a mortgage offer within a week. Brokers have years of experience and knowledge, hugely increasing the chances of success for the consumer.
I am not preventing anyone from making a decision to take a mortgage without advice, but there is a reason 97% of mortgage applications were submitted through brokers in 2024.
MORTGAGE BROKERS ARE ON YOUR SIDE; USE US OR LOSE US.
Call now to connect with business.
