My God Will Save Me

This morning three conversations have made me think of the endless optimism and faith in divine intervention.

All three have gone much like this conversation which typified the issue:

Me: “Hello I’m calling because I am in your area next week and wondered if I could visit to discuss secured loans with April the 1st in mind”

Broker: “why?”

Me: “Well if you write mortgages then secured loans will have to become a feature of your decision making from April the 1st with FCA taking over regulation of the product. Even if you don’t use secured loans, you will need to demonstrate they have been considered”

Broker ” Not interested mate, I’ve never done a secured loan, and I have no plans to do so. Click”.

Oh the “click” was the sound of the phone hanging up, not some sort of maniac verbal idiosyncrasy that one might as a suffix to a sentence definable by its ignorance and insanity. A click that signified “rebuttal not welcome”.

Insanity aside, practices taking this view are surely incubating an egg that will hatch into a nightmare legacy.

FCA “So you re-mortgaged your client to a higher rate and they paid a 6% exit penalty? Why?”

Broker “They wanted a further £50,000 and their current lender would not agree to a further advance”

FCA “Did you consider a secured loan?”

Is this the moment a broker’s professional life flashes before his or her eyes? A slow motion car crash moment as the words formulate from a mouth that had previously rebuked a hundred loan packagers, those words that had condemned a hundred conversations to be ended by an abrupt “click”, those words that will now condemn and confound their predicament “I don’t do secured loans”.

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The “oh god” moment, the family fortunes negative buzzer moment, a hundred conversations flashing through his mind, “I can help you with secured loans” click “We do secured loans” click “have you thought about secured..” click “Secured…” click “hey honey let’s have sec…”click.

CLICK. CLICK CLICK.

It reminds me of an old joke where a devout christian ends up capsized on his boat in the middle of an ocean. After an hour a lifeboat shows up, “don’t worry he says” rejecting the assistance “my god will save me”. Two hours later a cruise ship passes by, “don’t worry, my god will save me”, four more hours a trawler “don’t worry, my god will save me.”

6 hours later, the devout christian is drowned, his first words to St Peter are “why didn’t you save me? I go to church every sunday, where were you?” 

To which St Peter replies: “We sent you a bloody lifeboat, a cruise ship and a trawler, what more do you flaming well want?”

Therein is the crux of the matter, when brokers inevitably fall foul of FCA compliance for not looking to secured loans, will they be saying; “Where was my help with the product” or “nobody helped me”?

I envisage a St Peter like response from the regulator!

 

 

 

 

 

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Wag the Dog

It’s almost here everybody, have you been good girls and boys?

No not Christmas… REGULATION, and the FCA’s naughty list is a far worse place to be than Santa’s little Black Book.

The soon to arrive FCA Regulation of the secured loan marketplace is long overdue and should be welcomed by enlightened stakeholders with open arms, yet to some the spectre of regulation is making the cracks all too apparent.

Personally I don’t see the big deal, my ethos is to show up to the office, call FCA regulated firms offering my services, provide an excellent, compliant service to their customers and my intermediaries alike, then pay them what I have promised to pay them.

Those that do not engage in the secured loan marketplace, don’t because they have made an educated decision based on the level of training they have endured and do so based on current regulatory frameworks. If an IFA deems a packagers product portfolio to be inferior to his mortgage offering, we can present the advantages of the secured loan, even question his wisdom at electing to mortgage a client, but surely, until we are regulated and qualified to the level of the IFA it is not our place to castigate them.

Regulation will not change that, regulation won’t change what I do one little bit, and regulation will not change what that IFA does either.

Yet in what appears to be a display of panic, some contemporaries seem to think that they can wag the dog, that they can preach to those who have known nothing other than regulation by the FSA/FCA, be derogatory about the very mouths that feed the industry.

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Will a network embrace my service if I castigate it and its members? Unlikely

Will I change the minds of those who do not currently look to secured loans as an alternative by attacking them from my pulpit of ignorance? Unlikely

Over time, will those individuals engage with us because we demonstrate the ethics, service and knowledge that they demand? Absolutely

Regulation will change nothing in terms of business flows, those that use a preferred secured loan provider will continue to do so, those that don’t will need convincing that we aren’t all trying to teach them to suck lemons.

What regulation will change is the working practices of firms that are presently not compliant, it will uncover previously undisclosed bad practice, and it will extract rogue firms from the marketplace; perhaps that is reason enough for some to panic!