FREE!! WHICH mortgage advice

dimbo61

Just got my copy of this months which magazine and big article about the free mortgage advice service being offered.
What do you guys think?

magpiecottage

Their website says, "No one likes to pay for advice, so we don’t charge for it. Mortgage lenders pay us commission for arranging mortgages with them. We use that money to fund the service. Any profits go towards the campaigning Which? does on behalf of UK consumers. But if you would feel more comfortable paying us a fee, then we offer that option too."

The FSA has indicated to IFAs that it considers no fee to equate to commission bias. So I would suggest you may be getting what you pay for.

If you feel more comfortable paying me a fee for this post, I can offer that option too - please pm me!

trulysaintly

'No-one likes to pay for advice'?

No-one 'likes' to pay for anything, but when you employ a solicitor or accountant to assist you with the biggest purchase of your life, would you really want them to work for potentially nothing?

Which? are simply bankrolling the operation on the basis that they can 'pile 'em high and sell 'em cheap'.

If they get few applications, this brings in less commission - to cover higher running costs.

You get what you pay for in life...and you never get something for nothing.

themightywhites

magpiecottage wrote: »

The FSA has indicated to IFAs that it considers no fee to equate to commission bias. So I would suggest you may be getting what you pay for.

I am not in the mortgage industry so anyone with more knowledge please correct me if I'm wrong. 'Commission' and 'procuration fees' are different and this distinction is important. Commission is paid to mortgage advisors for selling associated products to the mortgage e.g. life or pensions policy. A procuration fee is paid to any adviser for only introducing the mortgage by the bank/building society.

'Which' would get a proc fee as any other adviser potentially would (hence they do not need to charge an additional fee to the borrower; it seems that the 'commission' that Which are referring to is the proc fee ). Clearly Which will be paid by the proc fee so how does this amount to 'commission bias' if they are only arranging mortgages?

Unless of course, Which are planning to sell life/pensions/income protection/critical illness cover etc alongside the mortgage, in which case I can understand this comment. As far as I am aware though they are not planning to do this.

Interesting though that the first two replies are from parties that have clearly vested interests; clearly they don't welcome Whichs' entry into the market; it's good for the consumer that Which are, in my opinion.

dimbo61

Thank you magpie for your very kind offer but i am quite happy with my current lender and current product ! Having said that I did not for quite some time even worry about what my mortgage reverted to after the long fix I originally took out.
we are now on a tracker and hope to clear the mortgage within 3 years paying as little interest as possible.
Martin Lewis has stated on a number of occasions that he would not get involved in any selling even though he now owns a multi million pound website with a massive loyal customer base.
Which getting involved in an industry which has had its fair share of problems may cause more confusion

themightywhites

dimbo61 wrote: »

... i am quite happy with my current lender and current product !

Fair enough dimbo61, but I suspect there are a lot of people, myself included, who need quality mortgage advice and 'Which' will be one that I will seriously consider, so thanks for the 'heads up'.

kingstreet

themightywhites wrote: »

I am not in the mortgage industry so anyone with more knowledge please correct me if I'm wrong. 'Commission' and 'procuration fees' are different

In this context, the procuration fee is obsolete and the word commission is now exclusively used to describe the payment a lender makes to the intermediary.

As the payment is normally a percentage of the mortgage being arranged, commission seems an apt description.

As an Initial Disclosure Document has to be provided at an early point in any transaction, the wording for a whole-market commission earning broker is "No fee. We will be paid by commission from the Mortgage Lender" and this is likely the reason procuration fee has fallen out of use.

On the general issue, Which appears to be offering advice on a commission or fee base, the same as most other whole market and independents. One would assume they will recruit experienced qualified advisers and operate in a similar way to L&C and Charcol.

I'm not sure it will make much difference to my sub-£100k, evening home visit, mostly blue-collar clientele in South Staffordshire.

opinions4u

Which? should keep out of providing this sort of service.

I cancelled my subscription when they started offering their own credit card.

Their impartiality is compromised.