Why do people use mortgage brokers?

dwsjarcmcd

Cleaver wrote: »

When we bought our first house the mortgage broker was really useful. My knowledge of mortgages consisted off: "you borrow money from a bank, you pay it back". Our independent broker was great at just explaining what different types of products were out there, what LTV was, overpayments etc. The fee we paid them, at that time in our lives, was well worth it.

Our last three mortgages I've arranged myself as I'm more inclined to do the research and I'm interested in the money side of life.

Saying that they are pointless is a simplistic view to say the least. Using the same logic you could argue that chefs, hairdressers, travel agents and countless other jobs are 'pointless' because you don't strictly need them to eat, make your hair shorter or book a hotel. I've never used a travel agent in my life, but I understand the role they play.

I think this post is spot on. Once it is 'demistified' it is straightforward to arrange a mortgage yourself, at least you only have yourself to blame. However, there will always be circumstances where professional help is needed.

Lifeisbutadream

mewbie wrote: »

Er how many mortgages do you have? I have one, and years before that I had another one. Not a lot of work there for a mortgage broker. I guess it's all to do with two year fixes, and constantly re arranging mortgages. Hmm. Well in that case maybe I'd use one.

I was thinking old school, 25 year mortgage, see you next time I move house.

I have one mortgage, I have had it for 10 years and I go on a 2 year deal every time. Inbetween that I have re-mortgaged 4 times, due to moving house/improving.

SO that is approx 9 re-mortgages

macaque_2

Lifeisbutadream wrote: »

I use a mortgage broker/financial advisor.
I know that he is making money - that is his job though - why would I begridge him of that?

This is a very depressing response. If you were getting good advice you would be right. The whole point of the article is that you are getting the very antithesis of good advice from mortgage brokers. The mortgage brokers are deliberately steering you away from the best deals for their own benefit.

The combined efforts of the financial services industry and government have reduced our economy to smoking ruins. After all that has happened, why do people remain so trusting? If I was to use a mortgage broker, I would insist on written confirmation (free of weasel words) that they had proposed the best value deal? I suspect that such a request would be very revealing.

Ian_Griffiths_Halifax

macaque wrote: »

This is a very depressing response. If you were getting good advice you would be right. The whole point of the article is that you are getting the very antithesis of good advice from mortgage brokers. The mortgage brokers are deliberately steering you away from the best deals for their own benefit.

The combined efforts of the financial services industry and government have reduced our economy to smoking ruins. After all that has happened, why do people remain so trusting? If I was to use a mortgage broker, I would insist on written confirmation (free of weasel words) that they had proposed the best value deal? I suspect that such a request would be very revealing.

What total and utter bollox. Any recommendation needs to be justified and despite not being a legal or FSA requirement, the vast majority of brokers provide the client with a "Record of Suitability". Something you DO NOT GET from Banks or Building Societies as you DO NOT GET advice.

If you go to many of the Banks and Building Societies direct, you will often not get offered the best mortgage, as you are not receiving advice.

Brokers protect clients from the mis-selling done by Lenders. They also steer them away from the lenders own, often considerably, more expensive Insurance Policies, and their roll is to help the client get the best deal available to them.

Unfortunately a few bad apples and very inexperience brokers have given us a blemished name. More reason than ever for the industry to have Apprenticeships, just like the Building, Plumbing, Joinery, Hairdressing trades etc. All have suffered due to the demise of Apprenticeships and now anybody can pick up a hammer and call them selves a Joiner for example.

poppy_f1

am having this debate with myself, on the one hand i know enough about mortgages to source a good deal however due to my position at the time (prob only just over 10% deposit) using a broker would be beneficial due to a lot of people getting knockbacks with 10% deposit and also to do a lot of the leg work
still got a few months before i need to fully decide

Thrugelmir

macaque wrote: »

This is a very depressing response. If you were getting good advice you would be right. The whole point of the article is that you are getting the very antithesis of good advice from mortgage brokers. The mortgage brokers are deliberately steering you away from the best deals for their own benefit.

The combined efforts of the financial services industry and government have reduced our economy to smoking ruins. After all that has happened, why do people remain so trusting? If I was to use a mortgage broker, I would insist on written confirmation (free of weasel words) that they had proposed the best value deal? I suspect that such a request would be very revealing.

A lot of people need guidance with financial matters due to their circumstances. It takes a lot less time to find a good broker than find the right mortgage.

PS. I have never used a mortgage broker myself.

Ian_Griffiths_Halifax

A quick look on the Mortgages and Endowments Board will show macaque why there is a need for Mortgage Brokers, as people need advice and assistance.

By the way. This afternoon I'm going to the bakers for a loaf which I could have baked my self and the grocers to buy a bottle of mlk, despite having room for my own cow. Sometimes you do things for convenience - not having time to do things your self - and sometimes you do thngs because you know people can do it better than you.

macaque_2

Ian Griffiths Halifax

You wrote

What total and utter bollox.

Please don't shoot the messenger, I'm only quoting the facts. Here's more from the article.
"In every case, the brokers gave us details of tracker and fixed-rate deals with higher rates and larger fees than the best direct-only deals."

You wrote

the vast majority of brokers provide the client with a "Record of Suitability"

Stop! I thought I said no 'weasel words'! The phrase "Record of suitability" is pure weasel for "artificial arguements to justify a poor deal."

One think I have discovered about financial advisers is that they have huge smiles and become your best friend within minutes. But ....... if you say something like "I want you to cut out the weasel words be accountable for your advice" they seem morph into monsters instantly and say nasty things like "you are talking total bollox". It is so disconcerting.

Ian_Griffiths_Halifax

Cleaver wrote: »

Our last three mortgages I've arranged myself as I'm more inclined to do the research and I'm interested in the money side of life.

I can also see how to some people it could be seen as "fun". Seeing if they can find a good deal.

At the end of the day, if somebody arranges their own mortgage thinking they've got the best deal, are they really going to carry on searching further and further to see if they could have got a better one? Most would call it a day at finding what they consider to be the best, and think they've done a good job. Would they find out that a better one or a better way of setting up that deal was possible.

How many people on here have had say 23 years of a 25 year mortgage term, and then arranged a new 23 year mortgage on a 5 year Fixed rate for example? Using a broker, they may have suggested somethng like:

Well if you don't need to save the £30 per month difference, how about we arrange the new mortgage over only 20 years"?

As simple as this may be, many client just don't think about it and often don't take into account that they now have more disposable income than when they took out the mortgage and I've never come across a client who have had recommendations like that by a lender.

Ian_Griffiths_Halifax

macaque wrote: »

Ian Griffiths Halifax

You wrote

Please don't shoot the messenger, I'm only quoting the facts. Here's more from the article.
"In every case, the brokers gave us details of tracker and fixed-rate deals with higher rates and larger fees than the best direct-only deals."

You wrote


Stop! I thought I said no 'weasel words'! The phrase "Record of suitability" is pure weasel for "artificial arguements to justify a poor deal."

One think I have discovered about financial advisers is that they have huge smiles and become your best friend within minutes. But ....... if you say something like "I want you to cut out the weasel words be accountable for your advice" they seem morph into monsters instantly and say nasty things like "you are talking total bollox". It is so disconcerting.

I'm sorry but I thanked you in error!

Perhaps the reason the adviser morphs into monsters instantly is because they are there, in front of YOU, at YOUR request, and YOU are calling them weasels!

YOU need to take a hard look at your self and understand how disrespectful you are!

A "Record of Suitability" is not some "Weasel word". It's common sense to the majority of people, that it is a Record of the suitability of the product.

And by the way, I am not a financial adviser, I am a Mortgage Consultant. I don't sell pensions, investments, ISAs, Savings Accounts, or Inheritance Tax Planning Tools.