Find out why they believe that good advice should not cost a thing
Many consumers are conditioned to think that to get a good product or service, they have to pay a certain amount of money for it. If they want to get those with better quality, they have to pay even more for them. Hence, the idiom ‘You get what you pay for’. Nothing really good can be acquired for free, they say.
Not everyone subscribes to that idea though. Take for example the people running this Salisbury-based adviser firm – they insist that good financial advice should not cost a thing.
“At Verve Financial, we are firm believers that mortgage and financial advice should be more accessible,” Gary Boakes (pictured), co-founder of the adviser firm, told the Mortgage Introducer. “That is why when we set up Verve, we took the decision to offer fee-free mortgage advice.”
Boakes related that he and his wife, Michelle, had previously worked for a corporate mortgage brokerage that charged fees, as most do, for providing mortgage advice. But for them at that time, something did not feel quite right.
“Sometimes, it felt that we were at the meeting with the client, justifying the fee rather than actually focusing on the client and their circumstances,” he recalled. “We also saw situations where people couldn’t afford the fee, but we knew that we would be able to help them with good advice.”
“Even now, we still come across customers who don’t know who their AIP is with, as brokers are worried about customers going direct. We wanted to remove those obstacles, and be in a position to offer a proposition that enabled everyone to get good quality transparent advice for free.”
Boakes said that one of the obvious advantages of being fee-free is being able to help everyone, regardless of their circumstances. He added that they get a lot of first-time buyers who are looking to save as much as they can towards a deposit. They always get more referrals as well, not only because they offer great service, but because it is free too.
The main disadvantage of providing fee-free service, he said, is if a client pulls out and no longer buys, an adviser has probably invested a lot of time and effort, and not been paid for their hard work. Boakes, however, stressed that the upsides of giving free advice “outweigh the disadvantage massively” for Verve Financial.
He also pointed out that while being fee-free attracts a lot of customers to their side, it is not the main reason why people choose them.
“It is a lovely selling point, but not our biggest selling point,” he said. “Our biggest selling point is how we want to put the customer at the centre of everything we do, the structural processes we have in place to ensure the client experience is as good as it can be.
“Also, our knowledge, experience, and work ethic will always outweigh the fee. We also have a financial advisor in the office so we can offer a holistic view on people’s finances and circumstances.”
Asked if he thinks more firms will follow suit and also offer fee-free advice in the near future, Boakes said Consumer Duty will certainly have an effect on how companies are going to charge, and what they can justify for each service they offer.
“As a fee-free company, it will be simpler as we are purely paid by the lender, regardless of if it is a product transfer, remortgage, purchase, complex BTL, or adverse,” he explained.
On providing mortgage advice without a fee, Boakes knew many would not agree with them.
“We are aware that we are in the minority, but this fits very nicely with our company values of financial wellbeing, and is something we are not looking to change any time soon,” he said.
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