Query in paying Financial Adviser

mcpee

Hi all
I did post this on another long standing thread but thought might be better to start a new thread with just this query...

My Wife and I are remortgaging our property and have been recommended a financial adviser by a family friend. On his company's 'Services and costs' they say, I quote:

1. We offer products WOM
2. For new clients a fee of £250 will be payable with your application for a mortgage, in addition we will receive commission from the lender.
3. No refund if you decide not to take out a mortgage product.

With the remortgage being for £216,000 the company will receive £781.00 in cash or benefits from the lender.

Does this all seem like a fair deal, before we send off the paperwork?

Thanks

Mcpee

dunstonh

Does this all seem like a fair deal, before we send off the paperwork?

It does. However, it may have been better to use an independent than a whole of market adviser if you are going to pay fees. The independent can include no commission paying deals. So, for example, paying £500 as an explicit fee to the independent may include mortgages that save you £1000 more than a deal that a whole of market adviser has.

My opinion, and its just that, is that if you are going to pay fees to an adviser then its best to go independent. If you want fees free then WOM is fine but no point paying fees for WOM.

will receive £781.00 in cash or benefits from the lender.

Its not quite as simple as that though is it. By the time the network/compliance company take their chunk, software and staff and other costs are paid for, the actual cash benefit to the broker is likely to be a lot less.

mcpee

That all seems fair.

I just wanted to check that it seemed all above board, but I completely understand what you say in regards to Fee paying v. commission.

The broker was recommended by someone who has helped out enormously in the past with financial help.

Thanks for replying

Conrad

Tis a good deal for a decent bespoke service especially where clients do not have such straightforward needs.
They may want to sell you insurance - I do this myself but I refund up to 50% of the life commision back into the policy so clients get a very competetive deal. If they try and sell you critical illness cover make sure it's with a large, reputable and well known provider - not someone like Zurich who are a pain when it comes to paying claims.