Martins View On Using Mortgage Brokers...

GMS

toshkininny wrote: »

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.

You would benefit from speaking to a 'Whole of Market' broker to avoid any unneccessary applications.

jim_1971

Even if it costs a bit - a good broker IMO is worthwhile. Our mortgage broker seemed to have access to deals that didn't seem to be public on the lenders websites etc. He also helped us with underwriting. I think the deal we ended up with was much better than we could have got by going to the lenders directly.

LULULU1

I am looking to help my son and his girlfriend to purchase a property. Bascially his name and mine would go on the mortgage and I would put the deposit. He is looking at properties approx 100k and I would put down approx 20-25k.

Which sort of broker should I look to use or how shoukd I proceed.

Also an other advice would be very very gratefully received.

Many thanks in advance

toshkininny

toshkininny wrote: »

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.

Hello, another quick question. Is there any harm in going to see a couple of mortgage brokers?

GMS

toshkininny wrote: »

Hello, another quick question. Is there any harm in going to see a couple of mortgage brokers?

Why would you want to try a couple?

No actual harm as such but if both brokers apply to the same provider there may be alarm bells. Also if 2 are applying at the same time you will have additional searches on your credit file.

Then there is an argument to say it is unfair. You are using 2 people, at least 1 of whom will not be getting any business from it.

toshkininny

Yes I see your point. But as I am going into unknown territory of using a mortgage broker I would wonder whether the person I was seeing was really whole of market, or just advising me on mortgages that they would get commission, and not too worried about the most beneficial for me.

GMS

Make sure you get an IDD (Initial Disclosure Document) or CIDD (Combined Initial Disclosure Document).
Complete a Factfind and check it before signing.
Get a KFI for the product, which will show commission to be paid. Get a Suitability Letter which will detail why the product was recommended.

It is nigh on impossible to have a product reommended which is in the interest of the broker and not the client.
If the broker is paid commission is there a problem with this? There needs to be some payment somewhere. Would you prefer to pay a fee and have the lender commission refunded to you?

People will use money supermarket and the likes to source insurance and never think to question the amount of commission paid by the provider. When it comes to one of the most important transactions of their lives, a mortgage, people want to get full advice for nothing.

If you have any issues along the way ask as many questions as you like. The process should be fully transparent so you will not be placed in to an inappropriate product.

dunstonh

toshkininny wrote: »

Yes I see your point. But as I am going into unknown territory of using a mortgage broker I would wonder whether the person I was seeing was really whole of market, or just advising me on mortgages that they would get commission, and not too worried about the most beneficial for me.

If you want full market then you are likely to only get this through an independent. A fees free whole of market adviser will typically only consider commission paying lenders. An independent should consider non commission payers as well as commission paying ones (with commission rebated to you)

Their position should be disclosed in their initial paperwork given to you as GMS describes. An Independent can often work as fees free whole of market or independent. The choice is yours. However, to use the independent tag, they must offer that fee based option.

SkyTheHero

i would'nt know

Quibbling

When searching for my new mortgage, I did my own search before going to a broker. Because of the recommendation on MSE, the broker I sought to use was London & Country.

The best deal I found was the Yorkshire Building Society. When I talked to the broker from L&C, I provided them with the details of the product I had found in addition to providing the information they required to arrive at their recommendation.

The L&C recommendation was a mortgage with the same conditions and fees as the Yorkshire Building Society, but a higher rate. The MSE website says that "Yet the Yorkshire Building Society and Britannia don't pay brokers a fee, and while true whole of market brokers should include them in a comparison, they don't have to offer to transact them for you." Not only did the particular L&C broker with whom I was dealling not include the Yorkshire in their recommendations, but when I suggested that I would go to Yorkshire direct he proceeded to suggest that he could process the recommended mortgage quickly, whereas mortgage processing at Yorkshire could be significantly slower. He said he couldn't definitely say that Yorkshire would be slow, but he would be concerned that this might be the case.

I also asked for a recommendation for Life Cover, again providing details of the best quote I had already found. The broker recommended a Life Cover product which he suggested provided the requested level of cover at a cost which was 30% lower than the quote I had found. However, when I reviewed the policy providers quote documentation associated with the quote I found that while we had discussed a dual life policy and the brokers cover letter stated that the policy was dual life, the attached quotation from which the policy cost was taken was single life. Needless to say I didn't go any further with London & Country.

Which leads to my question - clearly, this is a single unsatisfactory episode with L&C and may not be typical. All brokers will get it wrong sometimes. However, what checks, if any, does MSE do on its recommendations? Was my experience one of the few cases where L&C perform poorly despite a normal high quality service or was my experience typical and do L&C make recommendations based on income for them? Would a potential customer who was less financially aware than me get poor advice without noticing?