Adviser calls out those who pressure clients to use their in-house service
Broker Mike Hayes (pictured left) has spoken out about the distress caused to one of his clients by an estate agent whom he suggests tried to pressure her into using their own mortgage adviser and solicitor. He has accused some agents of particularly exploiting first-time buyers, who may not know any better.
The Manchester-based broker, who is an adviser at Neal Hayes Mortgages and won Broker of the Year at The Mortgage Introducer Awards 2024, said he had ‘once again’ had to deal with an upset client who was worried she was going to lose her dream first home, because of an estate agent suggesting that she would have a much better chance of securing the property by using their internal mortgage adviser and their chosen solicitor.
“I have met the client face to face, worked out her affordability, obtained a decision in principle and provided various options for different mortgages for houses in her budget,” Hayes commented. “She is as prepared as anybody could be at this stage of the process.” He added that as a fee-free charging broker, the agent’s offer of a £700 lifetime fee was therefore of no interest to her. “In my opinion clients are more clued up in 2025 than any other time in the 10 years I've been a mortgage adviser,” Hayes told Mortgage Introducer. “They know what is true and what is not. Perhaps if certain estate agents ran their branches more ethically, they'd see a lot more success.”
Clients being pressured into using agency-based brokers has been a consistent problem in the industry for all of Hayes’ time in the business, he believes. “First-time buyers in particular seem to be the target as the agents play on the fact that those clients don’t know any differently as they have no prior knowledge of purchasing a property,” he said. “The impact on those clients is that they feel pressured into using services that they don’t want to. They’re happy with a particular broker or solicitor but are then forced to choose between the house they really want and using the supplementary services of other firms.”
Hayes urges whistleblowing from agents working for firms which are culprits in this culture and practice. “It creates unnecessary anxiety and stress for clients and ultimately can lead to their vendor not selling the property to the person that they really want to sell to,” he said. “I’ve seen it personally, whereby offers from my clients not choosing their services have not been submitted to vendors. I had an interview myself 10 years ago at a large estate agency and terminated the interview part way through, after realising how I would be asked to operate with clients.”
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How long has this issue existed?
Gary Clarke (pictured right, new build account manager at The Mortgage Store, acknowledges this is a long established problem. “Every agent I’ve ever known has always preferred you to use their own recommended people as they, probably fairly, feel this gives them a better feeling of control, as well as being able to get answers quickly and more effectively when things aren’t going to plan,” Clarke said. “I think it’s fair to say, where a relationship exists between an agent and an adviser, things will generally run a little smoother. Agents also need to run enough checks, so the seller, who they represent, knows the offer in front of them is, within reason, proceedable and getting an offer qualified is not an unreasonable measure to establish this.”
Proper communication is key, in Clarke’s view. “Where it becomes troublesome, is that agents do not often explain this very well, and make people feel that they are being coerced into doing something they are uncomfortable with,” he commented. “After all, you are asking them to divulge potentially sensitive information to a third party, that deserves an explanation as to why. There is no guarantee that the adviser they are already dealing with has understood their circumstances properly, particularly with areas of advice that some may have more experience in - such as new build, or buy-to-let, for example.”
There are, however, agents and advisers who cross the line, in Clarke’s view, and the industry must be vigilant against such behaviour, he believes. “Where people behave immorally and unethically, there should be processes available to hold them to account properly,” Clarke said. “Potentially this could be via the financial ombudsman’s complaints service. I don’t really think it would be overly enforceable to any great degree as people are always very careful about what is put in writing, or the framing of phrases to stay on the right side of the law. The best deterrent is taking time to educate and help our clients, always acting to protect their best interests as consumers, ahead of our own, as advisers. When I advised, I was always very robust in explaining that there was no obligation to use my services, I would very much like to do business with them and was happy to explain the reasons why, but ultimately that the decision rests with them.”
Clarke never feared complaints from clients. “My purchasers were well educated on the processes and understood that while some processes may be necessary to move ahead, they still remained in control and had the final say,” he concluded. “The vast majority of my clients remained with me, others ultimately chose another route. Either way was fine with me, as long as the client felt their best interests were being served.”
