Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Solutions. Read the original article for full details.
Paradigm MD: Distributors Must Evolve to Meet Changing Adviser Needs
Paradigm Mortgage Services managing director Richard Howes has outlined how the relationship between directly authorised (DA) advisory firms and distributors is changing. Howes says that while traditional factors like lender access, procuration fees, exclusive products, events, and technical support remain important, these alone may no longer define the value a distributor provides.
Howes notes that the businesses working with distributors are evolving, and the environment in which they operate is also changing. As a result, he argues that distribution must adapt to meet these new demands. He highlights that being a DA firm does not mean handling every aspect of the business internally, and that one of the strengths of the DA model is the ability to choose where to retain internal expertise and where to bring in specialist support.
Howes suggests that DA firms should now consider additional factors when assessing distributors, such as compliance consultancy, technical expertise, business development, training, technology, and support with complex cases. He states that these areas could have a greater long-term impact than just lender access and fees.
Transparency in commercial relationships is also emphasised. Howes points out that DA firms should understand not only what they receive from their distributor, but also how terms are determined and whether all firms are treated consistently. He gives the example of Paradigm’s rebate approach, which applies regardless of a firm’s size, volume, or value.
Howes also notes that there is no standard DA firm, and requirements can vary significantly depending on the stage and size of the business. Newly authorised firms may prioritise compliance and consultancy, while larger firms may need support with recruitment, supervision, management structures, and staff development. As firms grow, their needs from distributors may shift, but the value of the distributor relationship can remain significant.
Source: Mortgage Solutions