Ambulance chasers are not seen as the best friends of the property and finance sectors. But, ironically, they could boost incomes for brokers and financial planners
A rising tide lifts all boats. But, when the tide goes out, its obvious who has been swimming naked. And with the property market being close to the top, many potential purchasers may be proven over-exposed should the property market decline or interest rates go up too quickly.
Evidence from the UK, shows that when the market goes down, these investors have sought to blame their broker or financial adviser.
And these tough times have become a potential feeding frenzy for ambulance chasing lawyers – who may see brokers as an easy target.
Thankfully, there is much that brokers can do to protect themselves – and in doing so, probably increase revenue.
At the recent Futurus Group conference, former NAB executive and previous Barclays mortgages CEO talked about his London experience, where many brokers were sued for not acting in the client’s best interest.
Mr Weston talked about how UK brokers were obliged to regularly review a client’s needs; ironically he felt that this extra workload could increase revenue for brokers who would end up refinancing a loan from a client review.
In addition, a ‘best interests’ test plus regular reviews is likely to lead to more brokers offering insurances to ensure that borrowers can make loan repayments even in unforeseen circumstances.