Do I Need Mortgage Insurance?

regularsaver1

If i remember the poster is not fees-free anyhow for mortgages so surely there would be a further fee

MortgageMamma

If it wasn't messing with people lives and financial security I would find conrads comments quite laughable. As it is, I don't know how he can sleep at night.

Hit the road jack, before you do any more damage.

msw_2

the information about the state looking after people, free cars, mortgage paid etc is complete exaggeration. Anyone who knows anything about the benefit system can see that the info stated is either fabricated or the person concerned is committing fraud....It's very very misleading to others to state that you will get a free car, mortgage paid, x amount of foreign holidays per year etc (in fact they only pay the mortgage interest, up to a certain amount, and even then they only pay after 12 months...).

Conrad

I was one of the lone voices way back when, critiscising the FS industry for endowment selling. At the same time I stopped selling Personal Pensions and would'nt touch bonds with a barge pole.

Fast forward to the late nineties and we found out that indeed the above products were very very poor value for money and that mis - selling had been uncovered on a grand scale.

I now predict the same is about to unfold with regard to Critical Illness and Income Protection policies. The FSA has just levied 2 huge fines against brokers selling mortgage payment protection - tip of the iceberge, and long overdue.

Brokers who promote thier 'free service' in my opinion are being economical with the truth. What they actualy are is insurance salesman and you can be sure that at thier monthly sales meeting much of the conversation will focus on insurance sales figures.

In terms of best advice, yes its at the core of everything I do, thats why I refer them to a specialist protection adviser who is dedicated to nothing but the subject.

This has to be best practice as it ensures the adviser is'nt spread too thinly in terms of knowledge and time AND allows the clients plenty of time and space to make the right decisions (ie not bombarded with huge volumes of insurance and mortgage information by one advice giver)

Conrad

MortgageMamma wrote:

If it wasn't messing with people lives and financial security I would find conrads comments quite laughable. As it is, I don't know how he can sleep at night.

Hit the road jack, before you do any more damage.

I sleep very well knowing Ive been entirely candid from the monoent I meet a client as to how I make my money, unlike the commision Crows who tempt people in with the promise of a 'free service' only to later subject them to pressure selling tactics in order to gain insurance sales.

Hope you sleep well Mortgage Mamma knowing you recommend new CIC policies every day to people who hold existing plans with far far better C I definitions?

AndrewSmith

Conrad wrote:

Brokers who promote thier 'free service' in my opinion are being economical with the truth. What they actualy are is insurance salesman and you can be sure that at thier monthly sales meeting much of the conversation will focus on insurance sales figures.

But you work on the assumption that fees free brokers are subject to such pressures as monthly sales meetings.

I am not an insurance salesman but a professional Mortgage and Protection adviser, self employed running my own business. I have no-one to answer to regarding 'sales figures' etc thus have complete autonomy over how I deal with each client case. My advertising overheads are very low due to the fact that I work mainly on recommendation thus I am able to pass this on to the client by not charging fees, coupled with the fact that I usually conclude business with approx 8/10 people I come into contact with.

Your particular business model may work for you, mine works for me. You have decided to charge a fee and only deal with the lending, I operate fees free and give full advice.


Since you like to ue analagies, here's one for you:

You go into a garage and ask for a service to be carried out on your car. The services will cost £399 at this or any other garage.

The grage down the road will complete all the work for you on their premses as they have the capability and the in-house technicians available to do so. Still for £399 all inclusive.

You find out that your garage still want you to pay £399 but you have to go elsewhere to get the brake fluid topped up or have the spark plugs replaced because your mechanic 'only does the basic service of oil and filter changing and does not deal with any add ons however vital to the process they may be'.

So off you pop to his 'recommended' technicial only to find that you may have to pay again to have the service completed which could have been done for one fixed price at the garage down the road.



Just because you like to work your way and charge for it doesn't make it either right or better than any other business model.

The FSA, my clients, and the local Trading Standards are more than happy with how I operate. That's good enough for me.

Your opinion means very little in comparison to those people.

What I cannot understand is how you can promote your service as good value? Espcially as this is a site dedicated to Money Saving.

I would Assume that the IFA's to whom you refer also charge a fee s they would be unlikely to take on a protection only case without doing so as it is so time consuming (your words)?

dunstonh

I now predict the same is about to unfold with regard to Critical Illness and Income Protection policies. The FSA has just levied 2 huge fines against brokers selling mortgage payment protection - tip of the iceberge, and long overdue.

To some extent I agree. Many mortgage advisers do not even mention PHI cover as an option when it should be considered before CI and in conjunction or in place of an ASU.

As an investment adviser, if you dont document options which are equally as good or potentially better or are similar, then you are just asking for an upheld complaint later on. The same will probably happen on the protection front.

However, that doesnt take away from the fact that if uninsured the potential consequences are massive for those that do not have the necessary funds to cover the shortfalls.

When shortfalls are researched and the recommendations based on accurate data using the correct products, then protection is viable and sensible.

If you use old fashioned methods like 10x salary (which ironically is used as a suggested method in Martins protection article apparently), then you will end up paying more for something you may not need to that degree. Just as selling an ASU to a self employed individual is probably poor value compared to a PHI.

toonfish

Conrad wrote:

Hope you sleep well Mortgage Mamma knowing you recommend new CIC policies every day to people who hold existing plans with far far better C I definitions?

more than a bit libellous I would think - you are becoming an embarassment to yourself

AndrewSmith

I agree with Dunstonh,

However as you will agree that does not apply to all mortgage brokers.

What conrad seems to be advocating is that it is better to simply not mention it rather than discuss the issue.

Conrad is assuming that all fees free mortgage brokers do not know about the correct protection strategie to apply to each situation. Totally unacceptable and incorrect.

Conrad

AndrewSmith wrote:

Just because you like to work your way and charge for it doesn't make it either right or better than any other business model.

Until a couple of years ago I advised on insurance. It was very lucrative.
I made the decision to end this valuable revenue stream in order to provide a better mortgage service, afterall thats why clients come to me, they certainly dont come to me to discuss insurance.

I used to spend approximatley 2+ hours per day dealing with insurance. Now that time can be spent on more mortgage research, seeing more lender representatives etc.

Lender reps tell me they often dont get to see brokers as the brokers dont have time. I on the other hand welcome all reps and gain additional knowledge as a result.

Clients are'nt children, they are more than capable of arranging thier protection needs without my 'help'. Many so do with the likes of Tescos.

I guarantee you ebery Estate Agency broker promotes thier 'free service' but fail to infrm clients up - front that a good deal of the meeting time with be spent discussing insurance. Clients tell me they feel this is a dishonest approach and worse still that they feel under pressure to buy insurance at a time and place it doesnt suit them.

Im proud to be a specialist and not a Jack Of All Trades.