"It’s not just having the support in place, but also the ability to actually understand the individual AR firm and what matters to them."
A new year means the opportunity for a fresh start for most of us. That doesn’t just mean resolving to lose some weight or drink a bit less, but also to make professional changes. And for a host of mortgage advice firms, that will be looking for a new network.
In some cases it will be broker firms that up to now have been directly authorised, but who believe they will be better served for the future within the umbrella of a mortgage network. In others it will be advisory firms that have already switched over to being appointed representatives (ARs), but are debating whether they would be better off within a different network.
So if you’re considering your network options for 2024 and beyond, what are the big considerations?
What support is on offer?
First and foremost, a network is there to support mortgage brokers operate at the highest possible level. A good network will have the guidance and tools in place to ensure that the broker is always compliant in their advice, something which has become an ever greater concern with the introduction of the Consumer Duty.
However, that support will ideally stretch beyond simply addressing the requirements of the regulator. What are the opportunities for continued professional development? The best networks offer training courses, allowing brokers to boost their skills and offer a more comprehensive service to clients.
Similarly, what is in place to support brokers if their clients need some sort of unregulated financing, like bridging loans or commercial mortgages? As more and more clients come forward with specialist needs, it’s crucial for brokers to be able to assist them, which is why it’s important for potential ARs to consider whether a new network can help them write that business.
More than a number
There’s more to a good network than simply delivering support to AR firms, however. There’s an intangible too, making broker firms feel like they are part of something special.
Recent years have seen the emergence of a host of extremely large networks, and while that size offers certain benefits, there can be downsides too. It’s not uncommon to hear from brokers leaving those networks that they felt they were just a number, and were not really appreciated by the network management.
If networks are to appeal to ARs, then I believe it’s important to deliver a personalised experience. It’s not just having the support in place, but also the ability to actually understand the individual AR firm and what matters to them. Ultimately, that closer relationship means the network is better able to provide the support that really makes a difference to ARs on a day-to-day basis, and it’s the end clients that benefit the most.
Technology you can trust
Technology plays a core part of any mortgage broker’s day job, so understanding what sort of systems are provided by the network is crucial for any AR firm contemplating a move.
If networks are to offer valued support to their member firms, that means offering access to cutting edge platforms which can support brokers with everything from sourcing and case management to making the most of cross-selling opportunities as and when they arise.
The right technology can make a huge difference to brokers. Utilising a suitable system can ensure the broker is much more efficient, making better use of their time, but also able to deliver a slicker and more satisfying experience to clients. That’s why it’s important to do your homework on the technology on offer from any network, and whether it’s likely to prove beneficial to your way of working.
Just as important as the software itself, however, is the cost. After all, in some cases ARs are expected to stump up further fees in order to benefit from those platforms and tech solutions, though others - like Beneficial, with our tie-up with Acre - include that access as part of the transparent, flat fee.
Finally, perhaps the most crucial consideration when opting for a network is working out the financials of the partnership. Ultimately the deal has to work for everyone, and allow you to run a thriving, viable business for the long-term, with the fee arrangement a significant part of that.
It’s common for networks to charge a percentage of income as their fee, and while that can work for some AR firms, the reality is that for others it becomes a problem. The lack of transparency can cause budgeting difficulties, while it can also act as an impediment to growth, given the way that the fee can snowball as the business expands.
We have opted for a different approach at Beneficial Network, with a flat fee structure instead. It means that everyone involved in the relationship is clear from the outset precisely what the tie-up is going to cost, making it much easier to plan for the future. And if the AR business has a particularly strong year, they get to keep all of that additional revenue, rather than have to hand any over to their network.
If brokers keep these key considerations in mind when debating their new home, they will be far better placed to make the decision for them and their business.