Martins View On Using Mortgage Brokers...

GMS

HSBC are offering fantastic deals at present which generally cant be beaten for price.

Your rant was perfectly justifiable, and equally frustrating for myself and countless other brokers on here who would offer a great service.

Good luck with the HSBC application.

bigtel69

Good Afternoon GMS... or anyone else who may be able to help

I was wondering if you could spare me a few moments of you time with regards to brokers and the fees that are envolved in purchasing a property.

Me and the Mrs have had an offer accepted on a lovely property... have a 10% deposit., and are going through the rigmarole of trying to find a mortgage. I have had a meeting with the estate agents broker and I am a little bit un-sure if he is trying to rip me off.

Is £939 reasonable for legal costs on the conveyance?
Is £540 reasonable for third party legal costs on the conveyancing? (and what are third party costs on conveyancing)
Do I have to pay for the valuation/survey fee??? and If I do... is £455 to much? Don't the bank do this anyway?
It differs from broker to broker... but is £300 reasonable for this fee.

Im sure im not the first... and definitely wont be the last idiot with these matters.

Thank you in advance for your time.

GMS

Firstly check if the EA broker is 'Whole of Market'.

£939 for legals seems a bit excessive but there can be added costs with certain properties so cannot really advise on that.

£540 for third party costs. Who's costs? Lenders legals should be included in the overall quote which as mentioned above seems excessive for a straightforward case. If £939 AND £540 I would be questioning why.

£455 for a survey. Depends on level of survey. Straightforward lender valuation or Home Buyers? Some lenders will do a basic valuation for free, others want paying and the level of charge is down to the lender and the survey type.

Broker fee of £300. Reasonable if you get the best deal. Some charge fees, some don't. Don't get caught up in the 'lender pays commission' trap. Some commissions are very small and would not reflect the level of work and costs involved. Depends on the loan amount. Certainaly not an unreasonable figure inany case.

rokatocboxers

Hi all if anyone can help I would be grateful. I am lookin got remortgage and 140k property for 94K all good credit history etc etc After browsing moneysupermarket for some remortgage comparisons, it had a option to discuss with an independant mortgage advisor, just the thing I needed.
To cut a very long story short he found a great deal with Halifax for me and over the phone went through the charges, £999 Halifax fee, £750 legal , £249 arrangement fee and (and this is exactly how it was said...) 1 4 9 9 5 for the fee. I took this to mean £149.95.
I was on route to work which he knew and he emailed the documents over to me. I didnt have a lot of time so when he called and asked if I had chance to look at the email I answered no. At that point he asked me to pay the £249 arrangemnt fee by card. (I suppose I should have been alarmed at the rate this was moving , I had only made the initial phone call a couple of hours previously). Once I had a bit more time I checked the things he had sent. All was as I thought except his boker fee which was actually £1450 plus all the other fees as broken down. This seemed STEEP and even tho he had planned to absorb this cost into the mortgage it was not a figure I was intersted in paying! If he had said that figure on the phone I wouldnt have gone any further with the call. I called him his response was ' I went through the figures with you at least 3 times' (as If I was stupid)
I know at no point was a 1500 pound broker fee ever clearly explained.
Anyway I have paid a local honest broker a reasonable fee and got a good deal on a remortgage.
I have spoken to the moneysupermarket guy again today and his response was by some miracle the finance department can drop that fee from near 1500 to around 250. A saving of £1200. So he was trying to rip me off after all! He will not refund my arrangement fee as he says its non refundable.
Im not going to sit back and let him do this to someone else. I will be on to Trading Standards later today.
Any other opinions out there?
Its people like him give the broker trade and the honest guys who work within it a bad name!

monks28

If you have 10% deposit I would get a fee free broker to come out to your house to see you and run through the rates they can get you, explain the process etc, it really is the best way. BUT have a look at HSBC 90% mortgage products and check to see if your circumstances fit with their criteria because if it does then it will be cheaper than what the broker can get.

dunstonh

monks28 wrote: »

If you have 10% deposit I would get a fee free broker to come out to your house to see you and run through the rates they can get you, explain the process etc, it really is the best way. BUT have a look at HSBC 90% mortgage products and check to see if your circumstances fit with their criteria because if it does then it will be cheaper than what the broker can get.

Why not an independent broker charging a fee which could end up cheaper than a fees free broker?

monks28

why pay a fee ? the fee free whole of market broker will get all the deals avaialble via brokers, and then just search the ones yourself that most WofM brokers wont recommend cos they dont get paid. Its not difficult so paying someon to tell you what you can find yourself seems pointless.

dunstonh

monks28 wrote: »

why pay a fee ? the fee free whole of market broker will get all the deals avaialble via brokers, and then just search the ones yourself that most WofM brokers wont recommend cos they dont get paid. Its not difficult so paying someon to tell you what you can find yourself seems pointless.

The independent mortgage broker will include deals that dont pay a commission. If the agreed deal does pay a commission it can offset the fee or even potentially result in a rebate of commission if the commission exceeds the fee.

If the non commission mortgage saves £30pm over 5 years, that is £1800 cheaper than the commission (fees free) version. If the fee is £500 then the person is £1300 better off going fee basis than they are going fees free.

Or if a fee is £500 and the commission is £650, then the person gets a net £150 rebate.

Isleman

monks28 wrote: »

why pay a fee ? the fee free whole of market broker will get all the deals avaialble via brokers, and then just search the ones yourself that most WofM brokers wont recommend cos they dont get paid. Its not difficult so paying someon to tell you what you can find yourself seems pointless.

I am in a process of remortgage now and looked myself for deals where I thought I could apply myself . However looking at the lender requirements I noticed that some of them have strict criterias and if don't meet those you may end up with refusals and damage your credit file.
I realised that I could go straight to Northern Rock for instance and apply for 3.64% fix for two years ( 75% LTV) or I could get the same deal through a WofM broker which I am happy I did as I got some very nice advice plus the chance of a refusal is considerably reduced .
In my case why should I go direct and have all the hassle instead having somebody experienced (WofM) who does this for a living ? Plus that it doesn't cost me even one penny as he gets his commision from NR and all the advice I got was topstuff .

toshkininny

Hi, my OH was out of work for just over a year. We were okay because we had mortgage cover. OH found a new job in June, and our fixed rate finished this month. We would like to find another fixed rate, and also borrow some more because we would like to extend the house.

Are we going to have trouble because OH was out of work for a year, and as he has only been in his new job for 3 months, will this be a problem for lenders too?

Thanks for your help everyone.