The changing face of mortgage advice

Regulation is an on-going theme of what we write about these days. We may not like it but we can’t escape it.

One of the things which regularly comes up in conversations these days is now that we are in this newly regulated world of advice – whether it is mortgages, insurance, investments, or KiwiSaver- businesses will change.

The face of the industry is changing too. TMM has been doing some work on how many new to industry advisers have come on board in the past two years. While this work is not complete a ballpark figure would be around 250 and many of these are younger advisers (under 35 years old).

At the other end we have seen mortgage advisers retiring or leaving the industry, but at lower rates than in the life insurance market.

A message which has been clear is that doing your level five papers and going through the registration process isn’t enough to survive in the future.

Advisers will have to change (and improve) their systems to be compliant when the regulator comes knocking.

In our Regulation feature this issue we have done the first of what will be a series looking at how you can remain compliant.

This is critical – in fact the survival of your business will rely on it.

The Financial Markets Authority now has a watchful eye on mortgage and insurance advice – two areas largely out of its remit earlier. A number of people have noted that the FMA has already started sending letters to advisers asking for information about their businesses and to expect a monitoring visit.

While we have not sighted the letter, everyone spoken to who had seen it said it will send the shivers down the spine of any adviser unfortunate enough to be the recipient.

It’s not just a letter saying we are coming to visit, get out the coffee and biscuits.

It’s a detailed list of information which is required – and in a relatively short time frame.

The FMA is now under the leadership of its third chief executive and the current one looks likely to bring a much more hard nose approach to regulaton than her predecessor.

Acknowledging a good bloke

I wanted to wrap up this editorial by paying tribute to Geoff Bawden. As we report in news Geoff has sold his Q dealer group to The Advice Platform (TAP).

He remains working in the business but more in a role mentoring new advisers.

Geoff was one of the advisers I first met when we established TMM, then called The Mortgage Mag. Indeed, he was influential in helping us establish the magazine.

Way back then we had the NZ Mortgage Brokers Association (NZMBA) which Geoff led for many years. NZMBA was subsumed into the Professional Advisers Association (PAA) which was one of the founding bodies of Financial Advice NZ.

Geoff has been a big supporter of TMM over the years and championed the work we do. I wanted to acknowledge his support and the tremendous amount of work he did for advisers when the industry was in its fledging state.

Philip Macalister Publisher