"Being qualified to give advice on something does not necessarily guarantee the advice you give will be the best it could be."
Since second charges came fully under the FCA’s jurisdiction in March mortgage brokers must decide whether to advise on seconds and keep their independent status, relinquish their independent title and refer clients looking for seconds to a master broker or simply let the client know seconds could be an option but have nothing to do with them.
At first glance one would say the first option is the best choice. By advising on secured loans the broker expands his business offering, offers a more holistic service to his clients and secures himself a lucrative commission.
However, that’s not always the case. Sometimes cases can be particularly complicated and by advising on products you have little experience with you could be leaving yourself open to complaints further down the line.
With some more complex products or complicated client circumstances it may be better to refer the client to a more experienced professional rather than give advice in an area you’re not fully converse with.
Let’s be clear, being qualified to give advice on something does not necessarily guarantee the advice you give will be the best it could be.
Some brokers could be so busy and hang on to customers they end up a Jack of all trades in order to have the best client offering, however there is a lot of be said for honing in on an area of expertise and being the master of that.
By referring clients to expert partners you’re still able to have a comprehensive offering but you avoid the risk of getting something wrong. What’s more, in most cases you’ll receive a decent income stream - or at the very least reciprocal arrangements.
Don’t put yourself at risk by attempting to deal with products that you’re not completely comfortable with. Focus on what you’re good at and team up with partner firms who are equally strong in their field to ensure your client gets the best possible service.
