Why are mortgage brokers leaving — and who pays the price?

The mortgage broking profession is under strain. A combination of work-life imbalance, regulatory creep, stagnant remuneration and rapidly changing client expectations is pushing advisers towards the exit — and those who remain are questioning what the industry's next decade will look like.

Four brokers, speaking to Mortgage Introducer, offered a candid assessment of what it costs to stay in the profession, why colleagues are leaving and whether the industry is doing enough to retain its most seasoned talent.

The pressure behind the exits

Nicholas Mendes (pictured top, far left), mortgage technical manager at John Charcol, says the post-pandemic period has been a particularly turbulent one compared with the decade before it. He identifies two distinct groups leaving: experienced brokers worn down by pressure, and newer entrants who misjudged what the role demands.

"Some newer advisers who have entered and then left the industry have, in the politest possible way, come into it with the wrong expectations," he said. "There can be an assumption that you will hit the ground running and immediately have a steady flow of business, when in reality becoming a successful broker takes time."

Mendes notes that the composition of business has also shifted, with remortgages and product transfers now dominating, and purchase and buy-to-let activity in decline. Advisers who cannot adapt their models have found the environment increasingly difficult.

Gerard Boon (pictured top, second from left), managing director at Boon Brokers, draws a distinction between two types of burnout. Self-employed brokers, he says, are most likely to leave due to insufficient lead flow, while employed advisers often reach breaking point from the opposite problem.

"By far, the most common reason is a lack of business," Boon noted. "Due to the level of competition now, standing out and generating a consistent flow of leads can be extremely challenging — especially for new starters."

The second reason, he says, is overwork and burnout among advisers with plentiful enquiries. "Due to the nature of the work, mortgage broking is highly varied and requires significant concentration to perform well as there is no room for error."

The personal cost of staying

For Michelle Lawson (pictured top, second from right), director at Lawson Financial, the burden is as much personal as professional. She points to lenders' practice of withdrawing rates at short notice as a structural driver of stress.

"Lenders encourage out-of-hours submissions by putting deadlines of rate withdrawals at short notice, evenings and weekends and when they don't have their own staff available for support," she said. "As a business owner, I truly never switch off — even on annual leave, emails need to be checked and actioned or forwarded to our locum."

Lawson is also critical of the widening compliance burden, which she says has displaced time from core advisory work. "We used to have just two FCA returns a year," she said. "A month doesn't go by now where something isn't required — most of which could be streamlined into the two returns from before."

Aaron Strutt (pictured top, far right), communications director at Trinity Financial, echoes the point on stress, noting that the volatility of the post-Truss era pushed some advisers to near breaking point.

"When the Liz Truss budget hit, the level of pressure on brokers was through the roof and many of them were at breaking point," he said. "I do need to manage my workload more than I did 10 years ago like many others in their 40s and 50s."

Strutt also observes that while the Mortgage Intermediaries Mental Health Charter signals awareness of the problem, the scale of stress-related issues in the profession suggests it is not yet fully resolved.

Remuneration concerns

Lawson raises a point others do not: that the financial reward for brokers has failed to keep pace with the volume and complexity of what the role now demands.

"Whilst loan sizes have increased, proc fees payable have remained stagnant for years," she said. "With all of the additional work we are required to do now around EPCs, portfolio landlords, licensing, cladding etc, the money we earn off a mortgage doesn't really cover its true cost of executing it — particularly on the smaller loans."

She argues that fee-charging has become essential to protect advisers' viability, and that brokers must be clearer about the value they provide.

What would make brokers feel valued?

All four interviewees identified consistent themes: better support structures, recognition from lenders and networks, and a more sustainable working environment. However, opinions diverge on who is responsible for delivering change.

Mendes argues that the industry must help brokers build long-term, self-sustaining client banks rather than simply routing leads. "Short-term incentives or initiatives can provide an injection of energy, but ultimately it is about putting sustainable support structures in place that allow brokers to build long-term businesses," he said.

Lawson is more sceptical about the prospect of significant change. "We need to feel heard, valued and appreciated rather than a cheap admin facility," she said. "This has been the same for over 20 years so I see no real significant shift."

Boon takes a markedly different position, placing responsibility squarely with advisers themselves. "I believe that the issue of experienced brokers leaving the industry is not the fault of the industry, but the brokers themselves," he said. "My advice to all brokers would be to accept that change is coming and try to get ahead of it to seize the opportunity."

The 10-year horizon

On the question of what the profession will look like in a decade, there is cautious consensus that consolidation and technology — particularly AI — will reshape the sector, but that human advice will retain relevance.

Mendes anticipates fewer standalone operators, with consolidation into larger advice groups providing access to shared technology, administration, and lead generation. He adds that established client books will increasingly be passed within firms as experienced brokers retire, rather than those relationships dissolving.

Lawson warns that the human expertise built up through years of manual research and market knowledge is difficult to replicate, and that consumers will ultimately bear the cost if that knowledge pool shrinks.

"The person who stands to be affected most will be the consumer as the adviser pool is getting smaller and the level of true experience is diminishing," she said, "with new entrants not using their knowledge but software to guide them."

Strutt raises a structural concern about lender strategy, noting that with close to nine in 10 new mortgages now going through brokers, lenders may attempt to bring more business in-house — particularly product transfers — in order to reduce distribution costs.

Boon points to the growing market share of fee-free online advice models as an indicator of where client demand is heading, and suggests that advisers who cannot adapt to digital, no-fee expectations will be among those most likely to exit in the coming years.

Mendes is measured in his overall assessment. "I don't necessarily see experienced brokers leaving as evidence that the profession itself is in decline," he said. "The role is evolving. Successful brokers have always had to adapt, whether that is to regulation, changes in lender appetite, new technology or shifts in the type of mortgage business being written.

"The brokers and firms that combine experience with better technology, stronger client relationships and a more sustainable way of working will probably be the ones best placed for the next 10 years."

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