A long time ago I used to work with an adviser who was approaching retirement and, after years of experience, was very cynical.
His favourite phrase, when referring to clients, was: “Watch out lad, cornered rats bite.”
Whilst his analogy was clumsy, his experience was real, and he was of course referring to the fact that, as soon as things go wrong, your client will turn against you.
When returns are good, you have no problems. There were of course no complaints about endowments in the late eighties and early nineties, there were no complaints about precipice bonds until the turn of the century, split caps were once a sound financial planning tool for school fees planning, and many IFAs would pray daily at the with profits alter, when MVR’s were unthinkable.
During the last ten years under this Government we have witnessed an increasing reluctance to accept responsibility for one’s own actions on the part of individuals.
The consumer increasingly believes that when things go wrong, there simply has to be somebody else to blame, or some regulatory body that will compensate them.
Now I haven’t been involved in mortgages for many years, but what I am seeing now is a turn in the housing market and the proverbial rat that fed so happily on self certification mortgages is starting to feel cornered!
During the last week I have heard a number of programmes featuring interviews with “victimised consumers” who knowingly overstated their income, but now blame the mortgage adviser for encouraging them or filling in the form for them.
Of course they had nothing to do with the application at all, they just signed it!
With mortgages now being regulated, I can only hope that the bulk of these mortgage advisers followed the correct guidelines and had all of their paperwork meticulously in place.
These clients who were such good friends at the point of application will soon turn and “bite” when repossession looms!
Adrian Shandley is managing director of Premier Wealth Management.
The views expressed in this article of those of its author and do not necessarily represent those of IFAonline or any other Incisive Media affiliated organisation.IFAonline
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