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Overall Margin Across The Value Chain Will Remain Stable. Intermediary ...


Overall margin across the value chain will remain stable.
Intermediary margins for non-conforming business will grow steadily.
There will be a slight increase in product complexity.
Home Information Packs (HIPs) will give a significant boost to intermediary business.
Lender concentration will increase marginally as smaller lenders will exit prime and larger lenders consolidate.
Consumers will be more aware of product options but will continue to seek advice and decision support from intermediaries "The numbers of customers who need advice will be sustained as the percentage of borrowers who don't fit standard criteria grows. This will lead to competition between lenders trying to leverage their brands, and brokers."

Increased product choice and complexity will sustain consumer demand for intermediary advice Intermediary distribution will continue to dominate primarily because there is nothing to suggest that product range or affordability will reduce the complexity of products. Consumers have the final call on which distribution channels will dominate going forward and it will not be the banks, even though some of their efforts might reduce the current intermediary market share from 70 percent to 65 percent

Lenders will attempt to increase branch productivity by streamlining sales processes through simplified KFI processes, implementing more effective valuation technology and offering free HIPs Productivity gains among lenders are hampered by slow progress in developing a Common Trading Platform (CTP). Some are investing in XML data services to interface to back office solutions for proposal tracking, contract enquiry and commission reconciliation systems but although 17 lenders are funding ORIGO mortgage standards development; the battle between Mortgage Brain and Trigold has stifled development the market needs an Exchange-type solution. Currently although most GI and protection is transacted on-line, mortgage cases have to be re-keyed. On top of this, FSA/DPA restricts growth of CTP: ideally brokers would fire a loan application to several lenders but the FSA is concerned that this would lead to a credit footprint
Having previously been self regulated, the mortgage industry was open to fraudsters and merciless lenders which was why it became regulated so that all lenders must declare themselves and their business so as to ensure it adheres to industry standards. The FSA is the body which currently oversees this industry and therefore stipulated a set of rules and regulations to ensure all the stakeholders get an adequate measure of comfort and security; namely the ICOB and MCOB. This research paper then examined these rules and regulations in relation to consumer credit; in particular the mortgage industry. The research objectives of this report then investigated if the CCA/FSA regulation has been a benefit to the industry i.e.


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