TikTok’s mortgage stars are calling for stricter rules on the social media platform to stop scammers spreading misinformation and to preserve industry standards.
Qualified mortgage brokers, who have thousands of followers on the video sharing app, are demanding rigorous checks on influencers who post videos that contain mortgage advice to ensure viewers get authentic information from professional brokers rather than scammers or those with no qualifications.
The problem with non-qualified brokers making TikTok videos that are not compliant with rules on the promotion of financial products is that they often circulate misinformation.
Sadly, this can mean viewers fall prey to scams. The data by Online Mortgage Advisor found that 99 per cent of the videos it analysed did not contain a disclaimer that would typically advise a viewer to do their own research, seek out professional advice or clarify that the content itself is not professional advice.
Ewa Brzeska, who has 91,000 followers on her TikTok account ThatMortgageQueen, suggested that TikTok can help viewers differentiate real brokers from fake ones by checking their qualifications against the Financial Conduct Authority’s register.
Brzeska, who is a mortgage and protection adviser at Carlisle-based Truly Independent, said: “More should be done in distinguishing who is certified in the mortgage field and who isn’t, so that people know they are receiving information from actual mortgage professionals.
“I think the easiest way would be for TikTok to verify certified mortgage advisers through checking their credentials against the FCA register. Any account that’s not verified should then have a disclaimer to tell the viewer that the person isn’t certified and therefore the information may be tenuous at best.”
Screening process
This was echoed by Kylie-Ann Gatecliffe, who has 18,000 followers on her TikTok account Kag Financial. She agreed that there should be a screening process for accounts that claim to be advisers.
Gatecliffe, who is a director at Selby-based Kag Financial, said: “TikTok should have a screening process for accounts set up claiming to be advisers. Firms should have to provide FCA registration, or copies of qualification certificates. We have about 300 enquires a month that come to us through TikTok, and we encourage them to look at us on the register, and view our website – so that they are fully comfortable with working with us.
“I do think it should be a requirement that the firm’s FCA number is listed on their TikTok page, so clients can see they are dealing with reputable firms.
“A disclaimer would also be a great idea as a reminder for clients to do their own due diligence when choosing to work with a firm they have found on TikTok, or any social media platform.”
These calls follow worrying new research that found one in four property influencers on TikTok feature misleading content about purchasing real estate.
The study, by Online Mortgage Advisor, which was published in May, also found that more than 1 in 20 of these videos featured an influencer boasting about how much money they had made through property purchases, and suggested to their viewers that they would be guaranteed profitable returns by following the influencers' methods. Only 4 out of 10 of the influencers analysed were transparent about their qualifications in relation to real estate investment in their bios or videos.
This is problematic, because the misleading TikTok videos in this research racked up a combined total of 10mn views and more than 900,000 likes.
Pete Mugleston, managing director at Online Mortgage Advisor, said one of the most common types of content found on TikTok’s hashtag #realestateinvesting, which has nearly 1.5bn views, was influencers bragging about how much money they have made by investing in properties. He said: “One money-making strategy that influencers espoused was ‘house hacking’, the term for buying a multi-unit property and living in one unit while renting out another to pay the mortgage. While the promise of profits using this method can be enticing, the reality is that property investment will never be a guaranteed source of income.
“Whether it’s your first home or an addition to your investment portfolio, buying a property is a huge financial decision that needs to be researched thoroughly beforehand.”
However, some experts in the industry have warned that too much regulation can stifle creativity on social media platforms.
More guidance, fewer restrictions
TikTok star and mortgage broker Saira Haider argued that it is more important to give the public guidance on how to process financial information, instead of adding more restrictions onto mortgage advisers.
Haider, who has 81,000 followers on TikTok account MansionBroker, and is also the senior mortgage and protection adviser at Kent-based company Mansion Mortgages, said “The platform allows you to share information, and people are aware that you shouldn’t believe everything you hear on socials. That’s a precedence when surfing socials. I follow up information with more research myself. I do that with everything though and wonder if others do the same? There should be more general guides for people who are on socials, starting at school level.
“Social needs to stay social. We should be able to speak freely, but at the same time the followers need to be wary of scammers. These days most people do find it difficult as the window is so much wider.”
Tackling financial misinformation on TikTok is vital, as the platform is accessed by more than 1.4bn people who are also facing the pressures of purchasing property in a highly competitive and increasingly unaffordable market.
Hashtags such as #property and #realestateinvesting have garnered more than 1bn views from people wanting to seek information on how to get onto the property ladder or make a real estate investment.
The FCA has started to step up action against rule breakers on social media, and recently told investment platform Freetrade to remove all paid-for social media influencer posts after its use of an influencer for the company suggested consumers in debt could use the platform to make money. In February, the FCA also warned investment companies to get legal advice before promoting their products on social media.
Robert Sinclair, chief executive at Association of Mortgage Intermediaries, said the regulator’s rules around investment videos on social media also apply to mortgage videos, as home loans are a financial product.
He said: ‘There are rules implicitly out there on individuals who breach financial rules, and that applies to mortgages, which are a financial product.
“At the moment, if brokers feel there are people out there who are circulating misinformation on social media, then they can take action by reporting them.”
Aamina Zafar is a freelance journalist
