"We believe there’s even greater scope for advisers to use remortgage to both sustain and future-proof business – and therefore hopefully reduce the startling £16 million commission blackhole."
Its analysis shows that remortgage and product transfers account for approximately 20% of all mortgage transactions handled by intermediaries, which in turn creates an opportunity for approximately 208,600 approvals annually and a potential overall commission for advisers of just under £17 million.
Yet, indicative market research suggests that the actual quote commission earned by advisers each year for remortgage is around £937,500, resulting in an earning blackhole of £16 million.
This means that advisers are only quoting on 5-6% of the total remortgage opportunity.
Paymentshield is encouraging advisers to tackle this disparity, particularly in the coming months as large volumes of five-year fixed-rate mortgages are set to mature following historic changes to tax regulations for buy-to-let landlords.
James Watson, sales director at Paymentshield, said: “Paymentshield has tirelessly championed the benefits of remortgage and product transfer for advisers: having those client discussions will always serve them well, by enabling them to review their customer’s financial situation and in turn presenting a natural reason to discuss GI. However, this year, we believe there’s even greater scope for advisers to use remortgage to both sustain and future-proof business – and therefore hopefully reduce the startling £16 million commission blackhole.
“For example, we’re expecting a wave of renewals for landlords who signed up to five-year fixed mortgages after the Government tightened regulations on buy-to-let activity. And, as a nation, since the past 18 months have dramatically reimagined our relationship with the home, we’ve seen home improvements skyrocket and with it the opportunity for quoting remo.
“In the next few months, remo opportunities will be prime for picking, and it’s our aim to help advisers to maximise them – starting with our September conference.”
