Mortgage brokers need to consider the size of their distributor's lender panel as the credit crunch leads to major changes in the industry, according to Mortgage Next.
As lenders strive to control their distribution channels and the quality of business, major differences will emerge between distributor’s panels.
Mortgage Next says the credit crunch has caused lenders to take tighter control of the quality and volume of new mortgage business.
As a result, many are becoming selective with distributors such as packagers, networks and mortgage clubs.
“This trend is likely to continue until we see an improvement in market conditions, which could be some time away,” says Gemma Harle, managing director at Mortgage Next.
“The consequence of this development is that distributor have’s and have not’s are starting to emerge, with some networks, clubs and packagers having extensive lender panels and others being left with limited panels and a restricted choice of products.”
Harle believes proc fees and service levels will begin to become secondary concerns when brokers choose distributors, and those with large panels of lenders will become increasingly popular.
Various lenders have left the panels of various distributors in recent months, and many broker exclusives are now only available through key distribution partners.
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