Martins View On Using Mortgage Brokers...

dunstonh

My mortgage application started mid March and here i am beginning of May and am still waiting for the final mortgage offer.

I think you have a misconception about remortgaging. 4-6 weeks is not an uncommon timescale.

cruising_2

i'm currently at 8 weeks and i've received unbelievably poor service so don't need smart remarks from someone like you.

dunstonh

cruising wrote: »

i'm currently at 8 weeks and i've received unbelievably poor service so don't need smart remarks from someone like you.

Your attitude stinks and with the misinformation you post its hard to believe you.

You said:My mortgage application started mid March. Today is 1st May. That is not 8 weeks.

mikey01

Hi there does anyone know whether its best to do a FPC or CEFA? I already have CEMAP and was wondering if anyone had done it? Thanks

mikey01

Hi there does anyone know whether its best to do a FPC or CEFA? I already have CEMAP and was wondering if anyone had done it? Thanks

Sarah_Williams_3

I am new to this forum. I just read Martin's view on using a mortgage broker. I have to say that I agree with him for the most part but I do not agree that you should only use Fee Free Broker. Simply because you get nothing for free and if you believe that something was given for free then it would have been either of "No Value" or "very little value".

Personally, I would be skeptical to use a Fee Free Broker because where does he or she make money from? I always paid my broker whether it is my stock broker or mortgage broker.

I know that many will disagree with me paying the broker because it is a money savings forum but I believe that paying a little to save more is a better practice because it is a win-win situation.

Sarah

homer_j_3

You could always go the independent route and pay the broker a set fee and get the commission returned. The broker does get paid commission if you go fee free, so there is no working for free as such.

Sarah_Williams_3

homer_j wrote: »

You could always go the independent route and pay the broker a set fee and get the commission returned. The broker does get paid commission if you go fee free, so there is no working for free as such.

Well, it is OK to say go independent but are they really independent? When I remortgaged my house in past I decided to look around and get advice from so called Independent Brokers but what I discovered did not make sense to me. Perhaps, other people may be surprised to learn this.

Correct me if I am wrong, according to FSA, any mortgage broker can call themselves Independent as long as they give customers choice of paying fee and return the commission. This broker played 2 roles. He was Independent and commission based. I asked him to explain.

He charged a fee of £675 when "Commission Based" but bumped up his fees to 2% of loan value, when an "Independent Broker". So in my case, the fee would jump to around £2000. So I questioned, would your advice be any different if I wanted your advice as an Independent Broker? No, he replied. It made no sense to me, if his advice is the same whether he acts as a commission based or independent then why would I pay him tripple the fee?

I took my business elsewhere simply because I did not trust him because he played two roles. Also, to me the word "Independent" means someone who just cares about his customers but it didn't seem that way. If he had just been independent and charged me £2000 for his advice, I would have had more respect for him.

Anyway, for those of you who don't know, Independent brokers are not what the word implies.

homer_j_3

Welcome to the world of the FSA.

Independent in this sense means independent from commission bias. It is not, as many folk believe, that they are independent from any one lender etc.

To me, the pricing of that broker was designed so you did not go independent. I for example would charge, for independent advice, somewhere in the region of 0.5% of the mortgage amount because that is close to what commission is received - commission being between 0.35-1% across most deals.

The fact is that the advice is the same and I do not even look at commission until I have to produce an illustration (as this has to be declared). Before this point it is working out the best deal.

Your original point is, you could not see how a fee free broker could be really moneysaving. I would very much doubt a fee based mortgage adviser could add value to your mortgage over what I or any other fee free broker on this forum could offer.

If you see value in paying a fee, that is fine but with independent based advice, you would at least get some of that back through the commission the adviser would rebate.

dunstonh

And independent for IFAs means independent but independent for mortage advisers doesnt. The FSA have really muddied the waters although they do seem to acknowledge this somewhat now but have no immediate plans to change the mortgage adviser status like htere are with IFAs.