Remortgaging and the use of an IFA

leatherneck

Hi,
Just some info on what happened to me recently.
Me and my wife needed to remortgage to raise capital for a building project, this time last year it was no problem with our current lender (Nationwide), but because of the credit crunch their maximum was approx 75% of what we needed to borrow.
We went to a whole of market IFA and she found that RBS would lend us up to 80% of our house value for virtually any reason. This was on a 2 year fixed rate of 5.79%, after having returned home I checked the RBS website and noticed that they did not have a rate of 5.79%.
I then phoned RBS and arranged a 2 year fixed deal at 4.99%. After speaking to the IFA she said that there was no 4.99% rate on her RBS linked site. After speaking to RBS and the IFA it appears there are different rates for IFA's and the public.
Do your homework, it may pay off.

nw_man

So, you did the honourable thing and paid the IFA for their time, yes ?

leatherneck

No, we were invited to see her we did not request the meeting.
We are however going to let her sell us some term assurance.

unite79

You mean get her advice, find out the cover, check it online with the provider, then save a little!

leatherneck

In this instance, Absolutely!

unite79

Great answer, what more can I say!

leatherneck

Unite,
What is your problem?
The point I was trying to make in the first instance is that IFA's do not always get you the best deal.
The fact that she found a lender is neither here or there as I would have found one in any case.
I asked prior to the meeting what her fees were and she said that she would be paid commission form the sale of any mortgage, if she had asked for money for her time then it would have been paid. WhenI told her what I was going to do she said I don't blame you.

I suppose you would get an estimate for someone to do some work on your house and pay it even though once you found out what was involved you could do it at a fraction of the price and within your capabilities?
If that's the case carry on.

koexelek

leatherneck wrote: »

Hi,
Just some info on what happened to me recently.
Me and my wife needed to remortgage to raise capital for a building project, this time last year it was no problem with our current lender (Nationwide), but because of the credit crunch their maximum was approx 75% of what we needed to borrow.
We went to a whole of market IFA and she found that RBS would lend us up to 80% of our house value for virtually any reason. This was on a 2 year fixed rate of 5.79%, after having returned home I checked the RBS website and noticed that they did not have a rate of 5.79%.
I then phoned RBS and arranged a 2 year fixed deal at 4.99%. After speaking to the IFA she said that there was no 4.99% rate on her RBS linked site. After speaking to RBS and the IFA it appears there are different rates for IFA's and the public.
Do your homework, it may pay off.

Would have been worth the IFA doing her homework too.

It's common knowledge most lenders offer better direct deals these days, so not worth trying to pull the wool over your clients eyes, as most people will seek a second opinion before committing.

unite79

I have no problem, the difference is whilst when you get a builder round for a quote, that is exactly what you are doing.

From reading your post, you appear to have seen the IFA for Advice, been more than happy with it, getting the LTV you required - Then gone on to RBS website to check - Hey presto - If you were so convinced you could do the job yourself, I wonder A - Why you went to see the IFA, and B why you have gone on a 2 year fixed with RBS - actually i take the 1st and 2nd back, and question why the IFA even recommended a 2 year deal!

happybroker

I think this is getting way off topic and rather unfriendly. As per the advice this site gives the OP has done what is needed and who they borrowed from, at what rate and for how long isn't the issue, nor is the fact that they saw an IFA.

The IFA will be ok with it I would imagine if OP is arranging life cover as she will probably earn more off that than the mortgage anyway and for a hell of a lot less time and effort, OP has got the deal they want (and without more information only a fool would question the product chosen) and the public at large can benefit from the knowledge the OP has picked up along the way...brilliant.

dunstonh

From reading your post, you appear to have seen the IFA for Advice, been more than happy with it, getting the LTV you required - Then gone on to RBS website to check - Hey presto - If you were so convinced you could do the job yourself, I wonder A - Why you went to see the IFA, and B why you have gone on a 2 year fixed with RBS - actually i take the 1st and 2nd back, and question why the IFA even recommended a 2 year deal!

The IFA was clearly not acting as an independent for mortgages (fee based and total market) but acting as a whole of market mortgage adviser looking at commission only deals (as most whole of market advisers do).

If the instructions to act had been on independent basis then you would expect the adviser to include non commission paying and direct deals in their research. However, its clear here that the OP did not employ the adviser on that basis (its possible, even probable that the adviser didnt offer that option)