A leading London mortgage broker has urged high value mortgage clients to seek professional, independent financial advice when looking for a home loan. Islay Robinson, CEO of London mortgage advisor Enness Private Clients, has made these comments following a recently published internal review of advised mortgage cases at the Royal Bank of Scotland which showed just two out of 91 customers received Mortgage Conduct of Business (MCOB) compliant advice.
The High Street bank report, published by Mortgage Solutions, found that in a staggering 89 out of 91 cases it was unclear whether RBS mortgage customers received compliant advice and the most suitable mortgage for them, as we see next.
In 2011, the Financial Services Authority flagged problems with Royal Bank of Scotland over the quality of its branch mortgage advice following a mystery shop. Mortgage Solutions reports that the regulator asked RBS to carry out a Risk Mitigation Programme action, or assess its branch, direct and live-observed advised mortgage sales to see if the problems had been resolved in a letter dated 4 November 2011.
91 sample checks carried out between January and July 2012 showed that just two telephone advice mortgage cases passed muster, with the other 89 cases divided between three ‘fail’ categories.
“This report shows the poor standards of service and record keeping by RBS,” said Islay Robinson, CEO of large mortgage specialist Enness Private Clients. “It proves that if you’re looking for professional, trustworthy advice then it often pays to head to a mortgage broker with experience of the type of lending that you’re looking for.”
The RBS sample showed that 28 cases had one or more key failures in the sales process, 56 cases failed to demonstrate product suitability or a fair customer outcome and in five cases, the recommended products were not suitable or affordable, the sale was non-compliant and the customer had not received a fair outcome.
Defending the results, the bank said the failures were solely a record keeping issue. An RBS spokesperson said: “Of the 91 sales we looked at, we found record keeping to be lacking in all but two cases. That was a big disappointment, but does not mean mistakes were made with the sales.
“To make sure we decided to contact customers directly to review their cases. In all but one case of the 91 we looked at we found that this had been strictly an issue of record keeping and customers were all on the right product.”
An FCA spokesperson said: “Firms should ensure that the advice that they are giving is of a high quality and is appropriate for the individual needs of the customer. If firms fall short of our requirements in this area we will take the appropriate action. We are already working with key stakeholders and firms to ensure they are ready to implement the new [MMR] rules.”
Mr Robinson, the high value mortgage specialist, added: “Many London mortgage brokers have extremely stringent compliance rules to ensure that the advice provided to high net worth clients is suitable. We’re no exception and always strive to provide the very highest standards of advice to our high value mortgage clients.”
For more information on how you can keep the best deal on your high net worth mortgage, feel free to contact one of our expert brokers for a free and personal consultation, or alternatively take a look at our latest million pound mortgage guide below.