Mortgage Broker Fees

recyclersrus

Our mortage broker said at the initial consultation that the broker fee would be added to the borrowed amount. Now we have an invoice for the broker fee - which we were told would be added to the morgage. Is this right and what if anything can we do about it. We knew and agreed the fee but just don't have the money up front to pay for it and if we would have known this beforehand we would not have gone with the mortgage recommended.

Any advice gratefully received.

Leon_W

You should have an Initial Disclosure Document (IDD) this will tell you what fees are payable and when.

It should also tell you on your KFI (Key Facts about your mortgage)

It should also tell you on the mortgage offer.

recyclersrus

What is an IDD we did not get one of these?
The broker fee was mentioned on the mortage offer but by that time if we did not take the offer we would be liable for the valuation and any solicitors fees.
All it says on the key facts is that a fee is payable on completion and not that it will (or will not) be added to the mortgage.
Thanks for your thoughts

Leon_W

I wouldn't panic.

Generally, if I charge a fee then you have to send an invoice to someone !

If the fee has been added to the mortgage then it will come as part and parcel of the mortgage advance, so it is either you or the solicitor that settles the bill.

Usually I would send the invoice to the solicitor and he would settle it on completion and it would appear on the completion statement.

Other than that, if the solicitor doesn't settle, then it stands to reason that there would be a surplus of funds which they (the solicitors) would return to you. These are the funds to pay the broker.

Hope that makes sense !:beer:

recyclersrus

Yes it makes sense. Thanks I hope that you are right! :-)

dunstonh

As Leon says, as long as the mortgage amount covers the fees, whether the solicitor pays the broker or the surplus is paid to you and you then pay the broker, it makes no difference.

Some solicitors will not pay the broker directly. They prefer to issue surplus funds back to you for you to pay them. You should be able to tell if you have borrowed enough to cover the fees.

smcqis

How much was the fee? sounds quite alot, my fee is 195