How to become a self-employed mortgage advisor

March 23, 2024 by Brendan O'Neill

Mortgage Advisors

A mortgage advisor – also sometimes referred to as a broker – is a person who provides those buying a home with guidance at every stage of the process.

Among the tasks that an advisor performs are sourcing a mortgage product that is affordable for a client and the writing and submission of the application to the lender.

There are two kinds of advisor though: an employed and a self-employed one. Employed advisors are usually restricted to recommending mortgages offered by the company they work for, whereas self-employed advisors can source products from any lender.

What does the CeMAP training course have to do with being a mortgage advisor?

The CeMAP course (CeMAP stands for Certificate in Mortgage Advice and Practice) is the one that every prospective advisor must complete to be able to legally provide people with mortgage advice.

It consists of a number of modules that have to be studied and that cover every aspect of the industry. The subjects for study include finance industry practice and law, completing mortgage applications, financial industry regulations and protection products related to the industry.

Some people complete the three modules that make up the course at training centres, while others prefer the flexibility of studying from home using an online training provider.

The typical cost of the full course will be in the region of £700. After the modules have been studied, an exam must be passed before you are a fully qualified mortgage advisor.

In addition to this, it is possible to study the CeRER course. CeRER is short for Certificate in Regulatory Equity Release, and this further qualification pertains to the later life segment of the mortgage market, which enables you to offer advice on equity release to people who already own property.

It is not necessary to have it to be a mortgage advisor, but later life lending can be a lucrative revenue stream, so many advisors opt to pursue it after CeMAP.

Can anyone become a mortgage advisor?

A career as a mortgage advisor is one that is open to anyone who is willing to take the time needed to qualify.

The mortgage market can be complex, and that is why extensive training is needed, along with continuous professional development after you qualify. It is also a career that will best suit those who have strong communication and interpersonal skills, in addition to being comfortable with technology.

Can a mortgage advisor be self-employed?

Self-employment is a popular route for new advisors to take, because they feel the greater freedom lets them offer better, more unbiased advice to clients. There is no difference in the qualifications needed for a self-employed advisor compared with one working for a brokerage, but there are other ways they differ.

One big difference is that you will be providing advice on an independent basis, and will not have access to the support networks that employed advisors can fall back on.

You will also be able to look for products for your clients from across the entire industry, rather than just from the company you work for. There is less salesmanship involved, but self-employment requires knowledge of the industry that is deeper and broader, as well as more contacts. If you are confident in your abilities, however, it can be the most rewarding way to operate as an advisor.

How do you go about becoming an independent advisor after completing CeMAP training?

If you have decided that working for yourself as a mortgage advisor is the right career path, there are business factors that you must bear in mind.

Working for a mortgage brokerage as an employee means that you can concentrate solely on advising clients, but there is a bit more to self-employment.

You will be responsible for managing your business and finding new clients and sources of income, as well as helping your existing ones.

That means taking on the task of promoting and marketing the business. It will involve creating a website for your business, as well as setting up and maintaining presences on social media platforms like Facebook, LinkedIn and Instagram as a way to raise your public profile. Working as a self-employed mortgage advisor will also mean handling all of your own tax matters, at least until you are prosperous enough to hire an accountant to deal with them.

How much can you earn as a self-employed advisor?

An advisor can expect to earn around £25,000 per year when they first start out. This can then rise to £45,000 or more a year once they become more experienced in the job.

However, as a self-employed advisor, you will have far greater control of what you earn.

Those are standard industry salaries, but your earnings will be determined by how many clients you can attract and how successfully you diversify.

Steps to become a self-employed mortgage advisor

1. Get Qualified

The first step towards becoming a mortgage advisor is to get the necessary qualification; offering advice without that is illegal. The industry standard qualification is the CeMAP one, which is a Level 3 course. CeMAP is accredited by the London Institute of Banking and Finance (LIBF), the official regulatory body for the industry. It is made up of a total of three modules and prospective advisors must then pass an examination before they are qualified.

There are several ways in which you can study for the CeMAP qualification. One is to complete it at a training centre while another is to study it online. The former offers a structured environment while the latter provides greater flexibility. The usual length of time for completion is between 6 and 12 months, but there is also a fast-track option.

In terms of alternatives, there are some equivalent qualifications offered by the Chartered Insurance Institute (CII).

Optional Further Qualifications: CeMAP is the only qualification needed to be a professional mortgage advisor. You can study for the Certificate in Regulated Equity Release (CeRER) though, if you want to broaden your services to include later life lending advice.

2. Legal Requirements

After completing the CeMAP course and passing the exam, you will have to be authorised by the Financial Conduct Authority (FCA). This is a type of registration, and it is essential if you want to legally offer advice for money. You can either be authorised as an appointed representative (AR) for a brokerage/network or directly.

The second key legal requirement is that you must have Professional Indemnity coverage.

3. Choose Your Setup

When it comes to your working setup, the first option is to join a mortgage network. Many new self-employed advisors choose this, as it enables them to get training and compliance help as well as access to major lenders. You will have to give part of your commission or pay a fee in exchange.

This option provides more freedom but also means a greater expense and administrative burden. It will require you to deal directly with the FCA in all compliance matters.

Curious to know more? Give our free online CeMAP training module a try or reach out to the team at Beacon Financial Training today.