How should advisors mitigate the increase in product transfers?

November 22, 2023 by Brendan O'Neill

Mortgage Advisors

Recent data for the UK property market indicates that borrowing levels among first-time homebuyers and home movers are both in a lull.

That leaves mortgage advisors concentrating on remortgage business, but a combination of affordability and rate rises have meant more people are looking at product transfers. This presents issues for advisors due to the generally lower processing fees that these bring in, so how should they mitigate the situation?

Turning down product transfer business is certainly not a good strategy, as it is still a reliable source of income, even with lower fees and the lack of conveyancing work. Instead, advisors should try to promote the important of general insurance and protection cover to these clients, especially those who manage to switch lenders without facing significant mortgage payment increases.

However, beyond that, they should focus as much attention on promoting remortgaging to clients where it can meet their needs. Greater numbers of mortgage lenders are now starting to reduce their prices, which will mean that those who have done a CeMAP mortgage advisor course have more options in terms of remortgage recommendations.

That will enable them to offer their services for conveyancing, as it can help clients to avoid the often-long process involved in free legals. Clients who are remortgaging on favourable terms – perhaps with a specialist lender – are also likely to be more interested in protection and insurance advice. This gives mortgage advisors another potential source of income during this period when the market in general is quite slow.