Limelight 50

LIMELIGHT A Tenet Group Publication for Appointed Representatives of TenetLime


Issue 50


Enhanced terms, more choice and a more simplistic process when quoting


Industry News: Business as usual and developments aplenty Market Watch: Get to grips with Tenet’s improvements in the Second Charge Mortgage area Tenet Events: Book your place for the final events of 2017 Up Close & Personal: Under the spotlight is Head of Policy, Simon Thomas

PLUS: The Force is with Kind Financial

LIMELIGHT A Tenet Group Publication for Appointed Representatives of TenetLime


Issue 50


Enhanced terms, more choice and a more simplistic process when quoting


Industry News: Business as usual and developments aplenty Market Watch: Get to grips with Tenet’s improvements in the Second Charge Mortgage area Tenet Events: Book your place for the final events of 2017 Up Close & Personal: Under the spotlight is Head of Policy, Simon Thomas

PLUS: The Force is with Kind Financial



Editor’s Foreword Grace Godson TenetLime Marketing Consultant

TenetLime Support 04 Industry News

Gemma Harle shares the latest 06 New Simplified Protection Panel Details of all the protection support available 09 Market Watch


Tenet’s improvements on the Second Charge Mortgage area

10 Tenet Events

Webinars, Roadshows and the Adviser Forum

Hello and welcome to Limelight: In this issue, our ‘Industry News’ article by Gemma Harle looks at a variety of developments and topical subjects, but also celebrates the luxury of operating in a relatively stable market right now. See pages 4 and 5. We are also delighted to announce that we have moved to a new simplified protection panel which took place on 17th July. This is part of our focus to provide you with enhanced protection support. This new panel has enhanced terms, more choice and a more simplistic process when quoting. As well as finding out all the details about the new panel, you can also check out the wide range of protection support that is available to you. Find out more on pages 6 and 7. Get to grips withTenet’s improvements in the Second Charge Mortgage area with our Market Watch article on page 9. If you haven’t considered, or have been thinking about giving advice on Second Charge Mortgages, then catch-up with Sam&Gav in the TenetLime team, who have covered improvements made to both our panel and our technology systems to make your life easier and may help you increase your offering to your clients. Don’t miss the Tenet events pages on 10 and 11. Have you watched any of our CPD webinars? If not you can catch-up at a time that suits you, as they are all available on-demand. We have also included dates for our second round of the mortgage and protection roadshows which will be the last for 2017, book your place now. Also included, we have exciting news on this year’s Adviser Forum and our annual Leading Lights event. Get to know our Head of Policy, SimonThomas a little better with our ‘Up Close & Personal’ article on pages 22 and 23. Tenet’s compliance guru fulfils a vital role across the group’s networks, ensuring we all act in accordance with every new piece of financial legislation and regulation. Kind Financial find the force is with them when they win their first Dragon Boat race and raise a whopping £2,300 for ‘Cure Leukaemia’, find out more on page 35. This is my first issue whilst covering for Caroline Taylor, and what a jam-packed issue it is! Included in this issue you will find the usual articles delivered by bothTenet and our Provider Partners, but if there is anything you feel would be a great contribution to this publication, then please do not hesitate to get in touch. Likewise, if you would like to contribute to our ‘Community Article’ which features at the end of the publication then please do let me know. You can contact me by emailing: Happy reading!


Provider Support 17 Just Talk Equity Release Building ER into the financial planning process 21 Royal London: Myth Busting… Trust me, I’m a Provider 27 Enterprise Finance Review The Second Charge growth opportunities Tenet Community 35 Kind Financial Raising money for Cure Leukaemia



Editor: Grace Godson

LIMELIGHT is a Tenet Group publication 5 Lister Hill, Horsforth, Leeds LS18 5AZ. Tel 0113 239 0011 Fax 0113 239 5322

Terms and Conditions. Although every effort has been made to ensure the accuracy of the information contained in this publication, The Tenet Group cannot accept responsibility for any errors it may contain. The Tenet Group cannot be held responsible for the loss or damage of any material, solicited or unsolicited. No reproduction of any part of this publication, in any form or by any means, without prior written consent from The Tenet Group. The views expressed in this publication do not necessarily reflect those of the advertisers or the publishers.


Industry News

Business as usual and developments aplenty …but time to also appreciate a period of reassuring stability too?

Shortly before this edition went to press, the FCA set out details of how the Senior Managers Regime will apply to financial advisers. The regulator has not yet set a commencement date but expects to publish final rules next year, after the launch of their 26 July consultation. Under the regime, anyone who holds a senior management function at an advice firm will need to be approved by the FCA and every senior manager will need to fill out a statement explaining what they are responsible for. Firms (provided they are not sole traders), will have to prescribe specific responsibilities to particular individuals to ensure accountability and certify that those working for them are fit to do their jobs. Clearly, it is still early days yet and the full implications are currently being evaluated – particularly what the effect will be on the FCA Register, which is such an important facility for both the industry and consumers alike. We are already engaging with the FCA and will keep you updated throughout the consultation process as we seek to assess the full impact and establish clear guidance for our members.

UK finance and banking industries are now represented by a one trade association, UK Finance. The new organisation, which went live at the beginning of July, combines most of the activities of the Asset Based Finance Association, the British Bankers’ Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association. On the face of it, amalgamating into one unified, larger trade body ought to ensure greater representation and make for a more powerful lobbying voice. But in welcoming that, I hope that the valuable role of the former CML will not be diminished. The CML did a lot of good work in our sector and we have a long history of co-operation and collaboration with them, as we also have with AMI (Association of Mortgage Intermediaries), and IMLA (Intermediary Mortgage Lenders Association). Popular estimates suggest that approximately 40 per cent of mortgage holders over the age of 65 have an interest-only mortgage, with more than half of these aged 75 or over.

These older interest-only borrowers have been a key driver in the growth of equity release business of late, with demand for alternative later life lending experiencing an exponential rise right now. The equity release market grew by 26 per cent in 2016 and is likely to make an even bigger leap this year – possibly by as much as 30 per cent. Measured by the value of lending, it has almost trebled in size in the five years since £789 million of activity was seen in 2011, according to the Equity Release Council. Part of the reason behind this growth in popularity could be attributed to the fact that thousands of homeowners could find themselves facing a mortgage shortfall this year, having taken out interest-only mortgages. According to the FCA, there will be three peak periods over the next few decades when residential interest-only mortgages will mature. The first one starts this year and runs through to the end of 2018, followed by another in 2027/2028 and a final one in 2032. Lenders have reacted positively to the situation, with around a dozen already active in the market offering an innovative range of new products to meet the specific needs of consumers. And of course, rates are the best ever right now.

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Despite the topicality of the subjects I have highlighted here, I am delighted by the fact that we are enjoying the luxury of operating in a relatively stable market right now. Rates are still at a record low, good affordability criteria are being applied to ensure there won’t be a repeat of the recent financial crisis, the buy-to-let changes have been absorbed, lots of new lenders are joining the market and an ever-expanding range of new products are being launched. So let’s celebrate the old adage that ‘no news is good news’ and hope the final piece of the perfect housing jigsaw can soon be put in place: the necessary housing stock to meet the demand!

While the leasehold system can help make sure homes are properly serviced, it has been massively abused by developers who are using it to get something for nothing. Any ground rent charges should be transparent, fair, and only increase in line with the cost of living or as a reflection of the services provided – not, as in some cases, doubling every 10 years. Buy-out terms can be equally extortionate. Ahead of whatever reforms the government may introduce, one has to question why a lot of people are being caught out or entrapped by such ‘hidden’ charges? Surely such charges - and their ramifications - ought to be made abundantly clear at point of purchase, either by the vendor or the purchaser’s solicitor? There are an estimated 1.2 million homes on some form of leasehold in the UK right now and evidence that the tide is turning is the news that one of the country’s leading housebuilders, Taylor Wimpey, recently set aside £130m for disputes. It is encouraging that something is finally being done. It has been allowed to run, relatively unfettered, for far too long and was in danger of becoming the housing equivalent of PPI.

The government’s proposal to ban leaseholds on a lot of new build houses and help to buy properties, and restrict ground rents to zero, has received universal backing from within the mortgage industry and beyond.

But professional advice is an essential component to unlock the full potential of equity release and more intermediaries should be making sure their clients are aware of all the options open to them and that downsizing is not the only option. The government’s proposal to ban leaseholds on a lot of new build houses and help to buy properties, and restrict ground rents to zero, has received universal backing from within the mortgage industry and beyond. Nationwide were among the first to endorse the move and I agree with their thinking that it will lead to better outcomes for those buying new build properties, by creating a fairer marketplace.

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NEW PROTECTION PANEL Plus a reminder of all the other enhanced protection support

As part of our focus on providing you enhanced protection support, on 17th July we moved to a new, simplified protection panel with enhanced terms, more choice and a more simplistic process when quoting. We hope you agree that this is very positive news and shows our commitment to providing you with the best protection support possible.

INTRODUCING THE NEW PROTECTION PANEL The previous Pick 6 and Elite panels were merged into one ‘whole of market’ panel, which is now our core panel of 10 mainstream providers. We have either maintained the existing rates or, in some cases, we have improved them. As the panel is researched by Tenet, it is classed as a whole of market so you

Please note: As per our existing ‘off panel’ process, if you need to use a product not included in the core or specialist panels, please complete the Off Panel Approval Request Form and send it to to seek approval. You can download the form via the extranet: extranet/4838.html Does anything need to happen with agencies? If you already use providers on the new core and specialist providers panel, then there is no action required – we will have simply moved your existing agency across to the new terms. If you don’t currently have access to one or more of the providers, you can request agency access by emailing . Please state which providers you need access to. IMPORTANT action for those previously on the Pick 6 panel If you are on the Pick Six panel you do need to update your Important Information about Our Services Document (IIASD) as you will be moving from a limited range to whole of market. In the protection section, please replace the current wording to: ‘We offer products from a range of insurers for Life Assurance, Critical Illness Cover, and Income Protection Insurance.’ Please note that you do not need to resubmit your IIASD to Tenet for approval. However, we do need a copy for our records, so when you have updated your document, please send a copy to If you are currently using the Whole of Market or Elite panels, you do not need to make any changes to your IIASD as it will already state that you are offering a whole of market offering.

can hold out as being independent. Providers on this core panel are:

We also have a specialist panel which includes providers who deal with impaired life, limited product ranges and new entrants to market. If you deem a product through one of these specialist providers to be suitable for your client, notify us of the client and provider name by emailing The specialist providers are:

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Enhanced documentation There is a new protection fact find and ‘demands & needs’ template, which are much shorter than the previous versions, making them quicker and easier to use. In addition, we have also provided a protection declaration to use with clients who refuse to have protection advice or don’t go ahead with a recommendation. By asking the client to sign the waiver form it heightens the importance and may make them think differently.

As per previous communications over the last few months, we have been making enhancements to the protection support we provider to help you increase your income and for clients to get the cover they need. This support includes: Enhanced helpdesk (0113 239 5111 ) If you write protection business… our Mortgage & Protection helpdesk is available to help answer any technical questions you have and help you place cases with the right provider. If you don’t write protection business… you can refer your clients to the helpdesk and they will advise the client over the phone and write the business for you. You will receive 30% of the initial commission , with no clawback after six months! Enhanced marketing support The Tenet Marketing team has produced a wide range of protection marketing support for you to utilise. This includes a ‘guide to protection’, posters, leaflets and adverts for the different types of protection cover, and sales aids to help you overcome objections.

Enhanced extranet content All of this support can be found on the dedicated ‘protection support’ area of the extranet. Simply type ‘protection support’ into the extranet search box and it will appear as first in the list of results.

TENET AND OUR PROVIDER PARTNERS ARE HERE TO HELP If you have any queries regarding the improved protection panel or any of our other protection support, please get in touch with our Mortgage & Protection helpdesk by emailing protection@ or calling 0113 239 5111. Likewise, there is a lot of support available via our providers on the protection panel, including Scottish Widows who feature on the cover and on page 16 of this magazine. We encourage you to get in touch with the providers to see how they can support you and your clients.

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You do not need to wait for approval and examples of the completed templates can be found on the extranet in the compliance manual under adviser tools & templates. If you still choose to introduce Enterprise, Norton or TFC Homeloans are happy to take a name and number referral from you. “So just a reminder of when a second charge may be appropriate for your client – it doesn’t always have to be down to credit problems!” Your client may have a significant ERC on their existing mortgage or their current mortgage is on interest only and they want it to remain on that basis. They may have a very competitive rate which they don’t want to disturb or would like some additional borrowing over a different term. Their circumstances may have changed since they took the original mortgage and they are unable to approach their existing lender for further borrowing. All the lenders on our panel have national BDM coverage and are happy to come and spend some time with you to see how second charges can fit in with your business. If you would like to arrange this please call the mortgage & protection helpdesk on 0113 2395111 or email . MARKET WATCH with TENETLIME’ s Research & Technical Specialists

Since we launched our own direct second charge panel in November there have been a number of improvements to Tenet’s offering in this area. The exciting news is that we now have enough lenders on our panel to be considered whole of market. We have Central Trust, Masthaven, Norton Home Loans, Paragon, Precise, Shawbrook, Step One & United Trust Bank. All the details can be found on the direct panel page of the extranet at . We are looking to add a further two lenders later in the year. You still have the option of using master brokers or packagers if you need to use a lender who is not on our direct panel. We have also given you another option in this area of using TFC Homeloans as well as Enterprise or Norton. And to make your life even easier very soon Tenet Loans Brain will be integrated into the Mortgage Brain system making it far easier to compare second charges against a remortgage. This should be available in both Mortgage Brain Classic and Anywhere very soon. For those on other sourcing systems Tenet Loans Brain will continue to be available. I have been talking with a number of members who have said once the technology is integrated they may choose to change their mind and give advice on second charges. Tenet is quite happy for you to do this and it does allow you to offer a more comprehensive service to your clients without the need to involve a third party. If you would like to do this all you would need to do is to update your Important Information about your Services document and send a copy to the compliance department.

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CPD WEBINARS Tenet is hosting a series of investment and non-investment webinars throughout 2017, covering a wide-range of topical subjects. Each webinar will last around 30-40 minutes, all of which you can view from the comfort of your home or office. You will have the opportunity to view the webinar and interact with the speakers, asking any questions you may have direct to the presenter. All you need is a device to view it on and your headphones! And if you can’t make the live webinar, you can watch the recorded version at any time to suit you. All of our webinars are accredited for structured CPD (mortgage &GI related webinars will offer unstructured CPD).

You can access full details by visiting our dedicated website:


Lending Solutions for Today’s Climate: First Start & Contractor The economic climate in the UK continues to evolve and with it comes challenges for home buyers; • House price inflation has continued to outpace earnings, leading many to conclude that owning a home or trading up may be out of reach • The “Bank of Mum and Dad” is now a top ten lender • Businesses are looking for an increasingly flexible skilled workforce to manage costs. We examine one of the ways Bank of Ireland can help your clients maximise their borrowing power, especially first time buyers. We will also take a look at the growing popularity of contracting. Register now to view on-demand: Buy To Let – The New World Recent changes to the buy to let market As the specialist lender you can bank on, Precise Mortgages will provide a market overview of the changes which will impact you and your customers. Register now to view on-demand: mean that this sector has again become more specialised in terms of lending solutions available.

No Income Means There Will Be An Outcome Income protection is still a hugely undersold product with only 7% of mortgage holders having any in place, and with the rental market growing faster than the ownership one its importance is increasing.

Income is key to financial survival, yet our clients do not see the need to self- insure should the worst happen to them, as their lifestyle and all that goes with it, is effectively rented and paid by their income. We all know that if you lose your income there will be an outcome, and the severity will depend on what financial plans are in place. That outcome will depend on the advice you gave your clients not just at point of sale but at ongoing reviews. We will look at the opportunities in the market for Income Protection and demonstrate ways to increase penetration of this hugely undersold product. Register now to view on-demand: Your essential guide There has been considerable change in the second charge mortgage market as a result of stricter regulation and adjustments in lender distribution, allowing advisers to have direct access to these products. Join Claire Rankin, Head of Network Distribution at Shawbrook Bank’s Residential Mortgages team who will be on hand to answer all of your questions around second charge mortgages. This is an invaluable opportunity to learn more about these often-overlooked products, and the scenarios where they might be the best fit for your customers. Register now to view on-demand: to Second Charge Mortgages in 2017

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NON-INVESTMENT ROADSHOWS – SECOND ROUND Starting on the 7 th November, we are hosting another round of dedicated Mortgage, GI and Protection Roadshows visiting 8 locations around the UK.

In this round we will have a range of mainstream and niche lenders who will update you on their current criteria, packaging and processing infor- mation. Each lender will be demonstrating their new tools, products and services, whilst giving you hints and tips to enable you to provide the best possible service to your clients. All of our events are open to, TenetLime, TenetConnect and TenetSelect brands and can be attended by advisers, staff, paraplanners and directors/ principals, free of charge.

To book your place early, you can register here:




Date Venue 15/11/2017 Southampton Hilton at the Ageas Bowl 16/11/2017 Birmingham Village Solihull 21/11/2017 Cumbernauld The Westerwood Hotel 23/11/2017 Belfast Stormont Hotel Location

07/11/2017 Leeds

Oulton Hall

08/11/2017 Manchester

Haydock Park

09/11/2017 Glamorgan

The Vale

14/11/2017 London Central

DeVere Holborn Bars

WILL YOU BE JOINING US AT THE NEXT LEADING LIGHTS EVENT? As you will be aware, each issue of Limelight we announce our Leading Lights winners for the last quarter, see page 15. Here we highlight our top performing firms and individuals and put their names up in lights. As a reward for appearing in the top positions, we hold an exclusive annual ‘invite only’ event to say thank you and well done to the advisers and to congratulate them on their success. We are delighted to be able share with you that the next Leading Lights exclusive event will take place on board the Sunborn London Yacht Hotel ( on Thursday 1 st February 2018, look out for further details later in the year.

2017 TENET ADVISER FORUM This year’s Tenet Adviser Forum is scheduled to take place on Thursday 7 th December at the Queens Hotel, Leeds.

We’re bringing the event back to the home town of Tenet and hosting it at the iconic Queens Hotel, situated at Leeds train station. The event will contain a morning of optional topic specific breakout sessions available to all advisers, which they can tailor to their training needs, followed by a formal afternoon business session with main stage content from Tenet Senior Management, external speakers and our top provider, lender and fund manager partners. Returning in the evening is the formal Gala dinner, which this year is themed Gatsby! Advisers are invited to stay on, courtesy of Tenet of course, and you can purchase tickets for partners. Guests in the evening will enjoy a formal gala dinner, with Gatsby themed entertainment. Early bird accommodation rates will be available to advisers who book between 1 June and 31 August, subject to availability. General registration and standard accommodation rates are available from September only, again subject to availability. We hope to see as many of you as possible at this year’s annual event and hope you’ll take the opportunity to host your Christmas party with us and your partners!

To secure your place please visit

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Tailoring protection cover to meet the needs of families today As we know insurance is not the most exciting subject to talk about, but we think we can all agree how important it is to have the right protection cover in place.

In today’s world your clients are busier than ever, working hard to buy that dream house whilst ensuring that they can continue to provide for their families. Most likely, family protection is not on their top list of priorities. It’s our duty of care to ensure clients are aware of the risks of not having adequate protection in place for their families, and the catastrophic effects it can have on them when the unplanned happens. Cancer survival rates have doubled in the last 40 years and in the next 10 years 1 , the percentage of men and women who will survive cancer will continue to increase. This is great news of course, but this will result in more people living with cancer and the subsequent financial impact this can have. On average people living with the effects of cancer are £570 a month worse off 2 , which makes it even more important that families have the right cover in place. According to Swiss Re’s Term and Health Watch 2015, Term Assurance was the largest sold product in the UK, with Serious/Critical illness and Income protection falling behind. Having life cover in place can help if your client were to die, but what about financial support for them and their family if they become seriously ill? We see more and more people are surviving

serious illnesses thanks to medical advances, but are now living with the financial worries. How will the mortgage and bills continue to be paid? How will I ensure there is as little disruption to my children’s lives as possible? Do I have security for the future? These are just a few questions we’re sure many people think of when the unplanned happens. It’s our job as an industry to ensure clients are aware of the protection solutions available to them, focusing on holistic protection solutions and moving away from a product sale approach. It is key to ensure that clients have the right cover in place, tailored to meet the individual needs of their family. At Vitality we offer a market leading Family Income Cover which allows clients to benefit from a regular income if a client becomes seriously ill or dies. This will provide your clients with a fixed income amount to help with ongoing household finances and takes away the financial uncertainties of becoming ill or dying. This fantastic benefit can be added to our Life Cover, Serious Illness Cover or Income Protection Cover, giving clients the choice and flexibility to suit their family’s needs.

Combining this with one of our Healthy Living Options*, such as Wellness Optimiser, ensures your clients has the best cover in place and can benefit from our exclusive discounts and reward partners for the whole family. We reward your clients when they lead a healthy lifestyle and we make it cheaper and easier for your clients to get healthier every day. Our extensive range of health and reward partners means your clients can benefit from things like discounts on gym membership, cinema tickets and activity trackers. With award-winning cover and all these unique benefits, you can ensure that your clients benefit from their Vitality protection cover now and into the future. To find out more about our Family Income Cover, please contact your Business Consultant or visit insurance/personal/additional-cover/ for more information.

1 Cancer Research UK 2017 2 Macmillan’s Hidden PriceTag Report 2013 * Rewards and benefits are available with VitalityHealth and certain VitalityLife products. Please visit for further information

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These league table results go towards qualifying for the annual event, see page 11 for more details. When compiling these tables we also take into consideration the overall quality of service and advice provided to the end customer – this includes customer satisfaction, adherence to our compliance standards and clawbacks.

Registered Individual

1 st 2 nd 3 rd 4 th 5 th 1 st 2 nd 3 rd 4 th 5 th 1 st 2 nd 3 rd 4 th 5 th 1 st 2 nd 3 rd 4 th 5 th 1 st 2 nd 3 rd 4 th 5 th 1 st 2 nd 3 rd 4 th 5 th

Graham Thomson James Akers Alan Johnston Andrew Lock Steven Pritchett Brian Thomas Wright Kevin Travis

GT Mortgages Ltd The Wright Mortgage Company Ltd City Gate Aberdeen Ltd Larkbridge Mortgages Ltd The Wright Mortgage Company Ltd The Wright Mortgage Company Ltd Intelligence Mortgage Solutions Ltd Intelligence Mortgage Solutions Ltd Intelligence Mortgage Solutions Ltd Encompass Financial Solutions Ltd

Top Mortgage Adviser Based on loan amount and number of transactions to take into consideration higher property prices in London

Top Protection Adviser by gross receipts

Alexander Adams David Nicholson Sam Hubbard Daniel Burgess Hayley Cook Jeremy Greene James Hill Chris Watts

Protect Line Ltd Protect Line Ltd Protect Line Ltd Protect Line Ltd Protect Line Ltd

Top Protection Arranger by gross receipts

Navdeep Kamboh Mathew Kind James Akers Christopher Naismith Robert Cooke

White Lion Financial Services Ltd Kind Financial Services Ltd The Wright Mortgage Company Ltd C N Mortgages John Graham Crabtree Ltd

Top GI Adviser by gross receipts

Appointed Representative

League Table – written business for quarter 2 – 2017 For all business via Office Net through April, May and June. These are productivity figures based on Q2 only. Leading Lights qualifiers are based on a 12 month period. Qualifying criteria includes quality of business, compliance standards and business productivity.

KT Partnership Ltd Options Mortgage Centre Anderson Harris Ltd Larkbridge Mortgages Ltd John Graham Crabtree Ltd

Top Large AR (5 and above) by average gross receipts per adviser

The Wright Mortgage Company Ltd GT Mortgages Ltd C N Mortgages

Top Small AR (4 and below) by average gross receipts per adviser

All Financial Advice Ltd The Mortgage Company Oxfordshire Ltd

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Striving for a perfect 10 in customer service Tenet is committed to providing consistent, first class, customer service. And as we mentioned last issue, at the end of last year we were awarded a three-star accreditation for ‘exceptional’ customer service by Investors in Customers (IIC) which represents its highest accolade. As you will be aware by now we have been running a ‘striving for ten’ campaign with our employees to help ensure we deliver continual service improvements, Consistent Achiever This award is designed to recognise those in our business who consistently do a solid job, demonstrating a great behaviour and are deserving of recognition. Nominations can be made by managers/team leaders for someone in their team, or by anybody for individuals either in their own team or elsewhere in the business. Winner: Catherine Coates Taking ownership

Awarded to the individual who takes ownership of a colleague, member or customer issue or request for help and demonstrates commitment to ensure a positive outcome. The issue may not be within the person’s remit or area of responsibility but they still communicate with the customer until a solution has been found. Winner: KathrynTaylor Delighting customers For regularly surprising customers by exceeding their expectations and demonstrating a personal interest in understanding and meeting their needs,

which has proved its worth in us achieving this fantastic award. As part of our ‘striving for ten’ campaign, we run quarterly employee awards to recognise key achievers. These are based on nominations from colleagues, underpinned by our ethos that ‘great service to colleagues enables great service to advisers, which enables great service to customers’. We also take into account any unprompted feedback provided by advisers, although we don’t actively ask for advisers to nominate our employees until the end of the year. Our awards and winners for quarter one 2017 are as follows:

going above and beyond. Winner: PhilWebster Team player

For excellence in teamwork and demonstrating our shared success, whether as part of a particular project or working group, or through the normal course of their work. Shares knowledge and experience across teams, has an open working approach, demonstrating honesty and integrity at all times. Winner: Nicole Turner

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BUILDING EQUITY RELEASE into the financial planning process

Good financial planning is about putting the right amount of money, into the right hands, at the right time. That’s why we believe in building equity release into the financial planning process. Here are some scenarios where it may be useful to consider equity release as part of the client’s • Clients with maturing interest-only or endowment mortgages (particularly where there is a shortfall). These clients may now be receiving letters from lenders asking for a resolution. • Clients with high credit card debt or payday loans and no clear repayment strategy. However, please think carefully before recommending securing other debts against your client’s home. Day-to-day living expenses • Clients who are on a fixed income and struggling to cover one-off unexpected purchases. This might be replacing white goods or car repairs. • Clients who are struggling to cover household bills because of inflation and rising energy costs. Maintaining lifestyle • Clients unable to buy a new car through existing cash resources or regular payments. • Clients struggling to fund a regular foreign holiday. They might not want to sacrifice the enjoyment of an annual getaway. overall financial plan. Debt repayment

Improving lifestyle • Clients who are looking to pay for private medical care. They may wish to fund this privately in order to avoid a potentially lengthy (and lifestyle-limiting) wait for NHS treatment. • Clients who want a one-off holiday of a lifetime. Or they might want to buy a caravan, motorhome, or holiday home. Family financial planning – advancing inheritances and skipping a generation • Clients with grandchildren who can’t afford a property deposit. Your clients might not have the money or assets to help. And inheritance may be too late to meet their grandchildren’s needs. • Clients helping with grandchildren’s education costs. Some grandparents may want to advance some of their inheritance now, skipping a generation. But they may not have enough non-property liquid assets. • Clients who want to give an early inheritance to the family, perhaps for a wedding or to ease the financial effects of a divorce. • Clients who are reluctant to enter long-term care. They (or their partner) may want to remain in their own home but need help with the costs of adapting their home and/or daily healthcare support. They may even be looking to find ways to prefund the cost of a funeral plan for themselves and their partner, but may not have the cash resources available.

Later life planning – things to remember It’s possible to either service or roll up the interest on a lifetime mortgage. It’s also possible to take an initial advance with an added pre-arranged drawdown facility. While we offer an interest roll-up and drawdown facility, we don’t currently have an interest-serviced option. Other lifetime mortgage providers can offer the interest-serviced facility (if that’s what your client needs). Another option is a home reversion plan. This is where a percentage of ownership is transferred to the home reversion

provider from the start of the policy. No interest is charged as home reversion is not a mortgage or loan. It’s important to note that clients will receive less than the current market value for the share sold. Equity release won’t be right for everyone. It can affect your client’s entitlement to state benefits and it will reduce the value of their estate.

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What’s your client’s DEADLINE TO BREADLINE?

Planning ahead is something we all do without thinking, from saving for holidays to who does the school run. Financial planning on the other hand can sometimes seem overwhelming or something to put off until tomorrow.

Our latest Deadline to Breadline research reveals that on average UK employees could be on the breadline in just 32 days if they lost their main source of income due to sickness, accidental injury or death. No one likes to think about what they would do if the worst were to happen, but worryingly more than a quarter (26%)also said that their current savings would last them just one week or less, highlighting that families across the UK are at threat should the main breadwinner die or become critically ill. The research highlights the significance and need for Protection, particularly Income Protection as it’s important to remember that we all have our own Deadline to Breadline and we really don’t know what’s round the corner. Other key findings: • The Deadline to Breadline rises to 36 days on average if respondents reined in their spending • On average, UK employees have just over £6,500 in savings, yet they believe they would need at least a further £9,830 to feel financially secure.

• Nearly one-quarter (23%) said they do not save any of their income each month, so for these people their Deadline to the Breadline could be tomorrow. • 69% of employees would go without eating out to make ends meet, while only half (50%) said they would end subscription services such as Netflix and Spotify • 16% of those surveyed had over £10,000 of debt to pay off, with the average respondent being nearly £5,000 in debt • A quarter (25%) of respondents have had to use a credit card in the last month to pay for essentials as they didn’t have sufficient funds to make the purchase • 30% of UK employees have no financial back-up in place should they or a loved one be affected by a critical illness, disability, redundancy, salary loss or death. What would trigger people to take out protection cover? The UK still clearly suffers from a savings and protection gap. Many of us ‘rent’ our current lifestyles, paying for it each month through

our earnings. Take that regular salary away and it may not just be their house that they lose, but their entire lifestyle. It is vital that individuals and families plan ahead for such a critical event to ensure their financial security. The main triggers for considering taking out a protection policy are: • Having a child – 34% • Buying a property – 25% • Illness – 24% Work out your client’s potential breadline. We believe that to make protection more relevant to clients we need to make it personal. Our Deadline to Breadline calculator can show your clients their own potential situation, so you can help them decide how to help protect their financial security today. Visit www.legalandgeneral. com/advisercentre/protection to use our calculator and take a look at our new Deadline to Breadline infographic.

LIMELIGHT | ISSUE 50 2017 | 19



Craig Paterson Underwriting and Claims Philosophy Manager, Royal London

Hard hitting headlines With headlines like these, it’s no wonder some consumers don’t trust providers. Trust is key. Your clients trust you to provide them with good, solid advice. And you trust providers to do what they say they’ll do. If it comes to the point where a customer has to make a claim we know their situation is already pretty bad. The last thing they need to feel is they’re being let down by you or us. The risk We know clients are already under insured. In fact we found some shocking statistics when we commissioned our state of the protection nation research. It’s overwhelming how many people think it’s important that their family is looked after financially if they should pass away, but at the same time don’t think they have a strong need for life insurance. Whether this is because they don’t have an understanding of the products or they don’t believe they will get a pay-out, there are a lot of people who could be leaving their significant others and children in dire financial straits – certainly not something they’d ever want to happen. 74% of UK adults surveyed didn’t have a life insurance policy. And of these 50% have no life insurance because they don’t see the benefit in owning it, or they don’t trust insurance companies to pay out in the event of a claim? 4 So nearly three quarters of people are without personal protection, leaving them at huge financial risk.

And what are their views based on? Sadly it’s common misconception. It’s all a myth As we know, good news doesn’t always make for a good story. Perhaps that’s why we don’t hear about these as often. But there are plenty of uplifting and reassuring statistics out there. “60% of claims paid out in 3 days”. 5 “£870 million paid in individual protection claims in 2016” 6 “92% of critical illness claims paid”. 7 We need to shake off this stigma and perception that claims aren’t being paid. We know convincing clients they need to take personal protection is hard enough so we want to help you manage this myth by providing you with claims stats and aids that you can easily pass on to your clients. Visit adviser.royallondon. com/protection/service/ claims to see our latest figures and to access materials to help you help your clients.


1 - disclose-information-HEADACHE.html 2 - dead-year-Legal-General-didn-t-believe-refused-500k-life-insurance-claim.html 3 -

4 – State of the protection nation – Royal London 5 - 6 - 7 -

LIMELIGHT | ISSUE 50 2017 | 21


Up close and personal with SIMON THOMAS

Under the spotlight in this issue is Head of Policy, Simon Thomas, who we appreciate is perhaps not a name many TenetLime members will be familiar with. Until now... However, Tenet’s compliance guru fulfils a vital role across the group’s networks, identifying, responding to and ensuring we all act in accordance with every new piece of financial legislation and regulation. Simon’s team helped oversee the smooth assimilation of the Mortgage Market Review (MMR), and the Mortgage Credit Directive (MCD), for example. More recently, they have been doing a lot of review work on the revised buy-to-let landscape and ensuring everyone is up to speed with the latest financial crime & anti-money laundering policies. And looking forward, the Insurance Distribution Directive (IDD) and the impending Senior Managers and Certification Regime loom large on the horizon. After just short of 20 years with his last employer, Lloyds Banking Group (where he started as a financial adviser in a division of the former Leeds Permanent Building Society), he joined Tenet five and half years ago. Away from work, Simon has a passion for historic aircraft and is a regular visitor to air shows. At the time of writing he was looking forward to the annual ‘Flying Legends’ gathering at Duxford Airfield in Cambridgeshire. He’s also a keen history fan and on the bucket list are battlefield tours, possibly beginning with some from the Napoleonic Wars. On a lighter note, Monty Python, Billy Connolly, Victoria Wood and Robin Williams are guaranteed to bring a smile to his face. But don’t let us tell you everything here – read on and get to know him for yourself!

Can you give us a brief history of your career to date? Life Clerk at Friends Provident in Leeds, then Life inspector, Adviser at Leeds Permanent Financial Planning, then various risk and compliance roles until leaving LBG at the end of 2001 to Join Tenet as Head of Policy. What do you enjoy most about your role at Tenet? The opportunity to interact with advisers and regulators, and to be able to influence both for the benefit of the end consumer. There is also the opportunity to be creative in finding solutions to business issues. What are your hobbies and interests outside the office? Some reading, but that is a bit of a busman’s holiday. I enjoy an airshow and have made a point of going to Flying Legends at Duxford many times during recent years. I also love a good movie or comedy series, particularly Black Adder, Open All Hours and Dinnerladies. What kind of music gets your toes tapping? It depends. I have a very eclectic collection. The last concert I went to was Robbie Williams’ ‘Heavy Entertainment’ show and I’m seeing Queen later this year. What book are you currently reading? The Compliance Revolution by David Jackman. What’s your favourite film of all time? Hard question that - impossible to choose between Ice Cold in Alex, Reach for the Sky and Zulu. If you could trade places with anyone for the day who would it be and why?

Caligula, Rome’s most tyrannical emperor – nobody would dare to argue with me.

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What’s the biggest lesson you’ve learnt in life? Where there is change there is opportunity. And finally, tell us an interesting fact about yourself… Clearly in compliance you are never going to be seen as particularly ’windswept and interesting‘ as the Big Yin puts it. However, I have done two firewalks at Tony Robbins ‘Unleash the power within’ weekends. I have also completed the Seven Stages of the Money Maturity course run by George Kinder, the father of life planning. You can even find me on the list on their website here: planner-search/results/?first_name=Simon&last_ name=Thomas

LIMELIGHT | ISSUE 50 2017 | 23


Understanding Limited Company Buy to Let

Phil Riches Head of Sales at Keystone Property Finance

the Prudential Regulation Authority (PRA) introduced new guidelines requiring lenders to tighten affordability checks on BTL landlords borrowing personally. Limited companies pay Corporation Tax rather than Income Tax so the new personal tax restrictions do not apply and consequently lenders offer them more generous income cover ratios. What’s the difference between an SPV and a trading limited company? A Special Purpose Vehicle limited company is a corporate structure set up to hold property only, unlike a trading limited company which is used to run a business. SPVs should have a Standard Industrial Code registered at Companies House from Section L: Real Estate Activities. SIC codes can be found at http://resources. . SPV or trading limited company? Does it matter? From a lender’s perspective, applications from SPVs are quicker and more straightforward to underwrite than applications from trading limited companies which require a greater level of understanding by the individual underwriter. Because of this there are more options available for SPVs and the pricing tends to be lower. There are a handful of lenders including Keystone which offer the same pricing for both. Can landlords borrow through a newly created SPV with no accounts? Yes. The mortgage will be underwritten based on the individuals’ (directors and/or majority shareholders) circumstances. In addition to the first charge, most lenders will require that directors and majority shareholders provide personal guarantees which means that they are

ultimately responsible for the mortgage if the company is unable to settle mortgage liabilities. Some lenders may extend these requirements to minority shareholders. Some lenders require a debenture and take a fixed and floating charge which may affect the company’s ability to trade and raise finance in the future. Keystone only takes a first charge and personal guarantee on both SPV and trading limited company transactions Can landlords transfer personally owned rental property to a limited company? No. By law, the transaction must be treated as a sale by the landlord to their company and will be classed as a related or linked transaction. The sale (which must be at full market value) is a taxable event which means the landlord is liable to Capital Gains Tax on the sale as well as Stamp Duty including the 3% surcharge on the purchase by the limited company. In certain circumstances the CGT can be ‘rolled over’ into the shares in the limited company, and incorporation of an existing property-owning partnership may be exempt from Stamp Duty but your client should check these with their tax adviser. The good news is, most BTL lenders (including Keystone) which offer products to limited companies, will consider related transactions. Call: 0345 148 9086 Email:

I have spoken to many brokers who are still learning about BTL lending to limited companies so I have tried to answer some of the most commonly asked questions. I hope you find it useful. Does it take longer to process a limited company application? Always err on the side of caution and allow extra time. Applications made by individuals and newly established SPV limited companies take a similar time to process, as the background checks are only carried out on the individual applicant/director(s) of the SPV. SPVs with existing properties and trading limited companies take longer to process because checks must be carried out on the company as well as the individuals. Are BTL mortgages for limited companies more expensive? Many mainstream BTL providers do not lend to corporates and thus some of the best mortgage rates are not available to limited company borrowers. Currently there are circa 16 lenders with nearly 300 different mortgage products for limited companies – compared with four times that number of products for individuals. Although limited company BTL mortgage applications generally take more time and require a higher level of underwriting skill to process, only some lenders pass the additional costs involved onto the borrower. Keystone offers the same pricing to individual and limited company applicants. Why can a landlord borrow more via a limited company than personally? As a result of the changes to Income Tax relief on finance costs, on 1 January 2017

LIMELIGHT | ISSUE 50 2017 | 25

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