Advisers facilitate consumer choice and foster competition

Intermediaries play a vital role in helping consumers find the right mortgage deal and have been largely instrumental in the growth of today's highly competitive mortgage industry, says IMLA, echoing the findings of AMI's recent publication ‘The Value of Mortgage Advice'.

Peter Williams, IMLA's executive director, comments: "Looking back 20 years mortgages were largely the domain of building societies and the limited availability of funds often meant homeloans were effectively rationed to the consumer. The growth of the mortgage adviser and the emergence of the specialist lender with no branch network and wholesale funding changed everything. It is clear that IMLA's members and membership could not have flourished without the intermediary sector. Consumers for their part have benefited greatly from the myriad of products available to them, and from the expert and indendent advice provided by intermediaries who guide them through this bewildering market place."

Against this backdrop the proportion of mortgages originated through the intermediary sector rose from around 25% 20 years ago to more than 75% in Q1 2008.

"In the current difficult times brokers continue to play a very important role in helping customers source a loan, regardless of the possibility that some lenders may favour their own branch network over the intermediary channel. Despite all the challenges, the market will return and a robust intermediary sector will be essential, particularly given the still substantial choice of products and the need for customers to be properly advised in both the TCF environment and in a more testing housing market. There will be no return to a choice of one product only, mortgage rationing or of customers being typically left on their own as they steer their way through the mortgage maze. The intermediary is an essential part of the landscape of the market - key to both customer choice and to maintaining a competitive market"