Can You Find the Best Mortgage Deal by Yourself?

powerwin

Hi All

If you have quite a simple first time buyer situation, do you think it's possible to find the best possible mortgage deal by yourself rather than consulting a broker? Surely the most keenly priced mortgages must be those from companies such as First Direct which keep their costs down and can accessed by borrowers directly?

Thanks

GMS

powerwin wrote: »

Hi All

If you have quite a simple first time buyer situation, do you think it's possible to find the best possible mortgage deal by yourself rather than consulting a broker? Surely the most keenly priced mortgages must be those from companies such as First Direct which keep their costs down and can accessed by borrowers directly?

Thanks

It is possible to do it yourself but that will leave you with a non advised deal with no protection.

If the case is straightforward then many would argue there is no need for a broker. Even if it is straightforward some people prefer to leave the legwork to the broker.

HSBC/First Direct offer great rates but tend to cherry pick. I had a client recently who was going with HSBC but ended up with another lender as it worked out cheaper when taking into account HSBC fees for valuation and legal fees.

Best rate is not always the best mortgage. Arrangement, valuation and booking fees can make a great rate a dearer deal.

Thrugelmir

powerwin wrote: »

Surely the most keenly priced mortgages must be those from companies such as First Direct which keep their costs down and can accessed by borrowers directly?

Better risk management results in keener pricing. Along with the fact that HSBC for all intents and purposes is an Asian bank. So funding mortgages is currently not an issue.

In terms of financial results HSBC's Q1 2011 were not good as their cost base is rising. So even they are looking at achieving better returns.

pinkteapot

When we bought, we did our own research and knew the mortgage we planned to take out. We did see the mortgage adviser in one estate agent to see if he could better it and he couldn't. It was worth asking though.

Definitely do your own research and don't just assume the broker's deal is the best. Will be for some people, not necessarily for all.

Wakey2008

GMS wrote: »

It is possible to do it yourself but that will leave you with a non advised deal with no protection.

What utter rubbish.

Finding a deal yourself does not mean you cannot get advice on the product from that lender's advisers. Brokers want you to believe that they are the only people who offer advice and protection. But all high street lenders have advisers qualified to the same, if not higher, level than a broker.

If you find a deal the bank/building society adviser has the same duty of care to advise on the suitability of a product as a broker does. If it's not suitable, they will tell you.

Yes, some lenders offer a non-advised option. But it's exactly that, an option and it's one to be avoided.

Brokers are best used in complicated cases and at present often do not offer the best rates on the market. Like in all cases, if you don't need a middle man, don't use one.

powerwin

I am the kind of person that likes to look into things in detail myself, and I have the time to. The only thing I was wondering is whether a mortgage broker would have access to better deals than I can track down myself, but I don't see why this should be the case.

Rgds

Thrugelmir

powerwin wrote: »

but I don't see why this should be the case.

Depends on the specific market segment that the lender is targeting as to the sales channels they use.

kingstreet

The market changes. Prior to the crash, brokers had access to the best deals on the whole. Now, banks and building societies are choosing to retain those deals for themselves, as the money they would have paid to brokers can then be used to sweeten the deal, or for their own cost coverage.

I'm sure that as time passes, lenders will once again start to favour the intermediary market, because it's much more cost effective to have someone else find and process the initial application for you than it is to do it yourself.

About ten years ago, C&G calculated it cost them around £4,000 to get each new customer through the door directly, but the fee they paid intermediaries was a fraction of that. With internet processing and the brokers keying the applications, lenders costs drop using this channel.

Direct-only lender ING has recently opened up to business from intermediaries.