Is a mortgage broker worthy of consideration

adindas

Given theat the current lending and borrowing siatuion, it is more difficult for people to get a Mortgage.

I understand that Martgage broker is to be able to see from a lot of providers. But for people are dififcult to get mortgage today, is their advise is worthy ...

Say for instance they say it is better you ask for this provider but in fact, when you afollow their suggestion, you get rejected ?

Is not that it is better to sticj to your bak who knows wel your financial stability and ability ??

I undesratnd that some mortgage adviser are free of charge.
I am asking here because once you get rejected it will seriously danage your credibility to get another lender ?

Opinions and expereince from people in ths forum are really appreciated....

MRG

First of all I disagree that its harder to get a mortgage...compared to the days of 100%+ mortgages yes but for the right applicants there is plenty of lending available.

Obviously I am biased as I am an independant mortgage adviser but my view is it is good that we can source the whole market finding the best deals and knowing the specific lending criteria of each lender.

I used to work for a bank and I would never offer my services to my friends and family as I didn't know whether there were better services elsewhere. Now I am comfortable doing things for my friends and family.

Banks will want you to think that you have a better chance of getting a mortgage with them as you have your finances with them but this is simply not true.

If you get rejected you need to look into the reasons why...affordability..credit score etc

ACG

Agreed with above.

Banks pretend that theyre your friends, we know you you bank with us, keep your mortgage with us there wont be a problem. Its a lie! The mortgage advisor has no way of knowing how the underwriter will review your application any more or any less than i do...I bank with RBS, i spent 3 years working for RBS, i left and a year later i applied for a mortgage with....RBS...guess who declined me! They declined me because i was pushing the limits as to what i wanted to borrow. If i had gone to an advisor they would (and did) find me a lender who would lend me a slightly higher amount than RBS. If only i were a mortgage advisor back then.

I am now a Mortgage Advisor, once i have your details and know what your after i have account managers and BDM's at most of the main lenders and some of the smaller ones too. I can run your details by all of them in one email or a couple of phone calls - find out who would accept you based on the info you gave and get the best deal from those lenders.

If you are looking to push the boundaries to what you can borrow, your credit score, your income multiples or you dont have the time and you want to be sure your getting the best deal and are covered by the Financial Services compensation scheme - then yes, see an advisor.
If however you know what your doing or have the time to learn, arnt too fussed about getting the best deal so long as its affordable and your safely within the lending criteria, then no you dont need a broker.
...Thats my opinion anyway :-)

handytips

Not being judgemental here but i think the tone of the OP is they need help, as it is clear they understand very little

dunstonh

For those that meet traditional lending criteria, it is no harder to get a mortgage today than at any other previous time. It is only harder if you are going outside of traditional lending criteria (i.e. defaults/CCJs, pushing income limits, little or no deposit).

I undesratnd that some mortgage adviser are free of charge.

Whole of market ones are. Independents charge a fee but will rebate commission, if any. So, that may be cheaper. Independents will also consider non commission paying deals whereas whole of market usually do not (as they wont earn anything if they did)

Conrad

ACG wrote: »

If however you know what your doing or have the time to learn, arnt too fussed about getting the best deal so long as its affordable and your safely within the lending criteria, then no you dont need a broker.
...Thats my opinion anyway :-)

I'm sorry this is another dubious statement by a broker.

AGAIN - THE BEST DEALS ARE OFTEN DIRECT TO LENDER, NOT VIA A BROKER.

Ask your broker to give you advice on all the deals that pay him no commisions, such as those from HSBC, CO - OP, First Direct and others. See how long he wants to stay on the phone then.

Seriously people, all of you can very easily find the best deals yourseleves just as you manage perfectly well to source cheap car insurance and flights and the best school for your children. It takes no skill whatsoever.

A decent borker will sacrifice a portion of his life assurance commion to make the premiums as low as possible. Make sure your 'honest' broker has done this and check he's offered the lowest premium by making your own investigations.

Only people with complex situations need a broker.

ACG

The software i used is probably the same as the one you use - it allows me to include deals if you went direct to the lender. I can be quite confident when i say this is the cheapest deal.
What are the chances of an individual from say manchester - looking at mortgages from YBS or Leeds building society or principality or any of the other lesser known lenders who are offering good deals? I imagine its quite slim.
So i would still recommend people see an advisor and like you say include deals if they went direct.

dunstonh

The software i used is probably the same as the one you use - it allows me to include deals if you went direct to the lender.

That is to allow independents to still recommend direct to lender products.

Conrad

I've been in the business 20 years, and am confident 99.9% of brokers wont be recommending a direct deal that pays them nothing. I hear them say things like 'oh don't try HSBC, they are hard work'.

By all means clients can try a broker, but all I'm saying is check out the direct to lender deals yourself - there aren't that many lenders afterall, so a few hours work could save £££.

Personally I like the honest approach of charging a fee up front that entitles the client to truly independant advice without commision clouding the picture. A good broker has no problem working this way - try it, you might surprise yourself. The cheapest footballer is rarely the best, so brokers who make a play on not charging fees are in my experience less likely to survive more than a few years. Do it properly and dont be embarrased about needing to charge a fee.

dunstonh

Personally I like the honest approach of charging a fee up front that entitles the client to truly independant advice without commision clouding the picture.

I agree. And in many cases it is cheaper to pay a fee than it is to go "fees free".

However, I can understand the reluctance of commission based advisers to move to fee basis as the unknown can be scary. It takes you outside your comfort factor. All i can say is that it is not scary and when you explain the choice to the client, most will understand and choose fee option.

Say your fee is £600 and the commission deal pays £750. The client gets a £150 rebate. Or say the fee is £600 but the non-commission paying mortgage works out £3000 cheaper over the term of the deal than the best equivalent commission paying deal. That person is still £2400 better off than the fees free commission option.

For those that dont charge fee, maybe the next couple of mortgages you do, just compare the non-commission paying deals to the commission one and compare the cost over the term between them. See how they compare for yourself.

ACG

Ive only recently in the last couple of months started doing Mortgages, i was previously working with a life office so ive come into this starting the way i mean to go on.

I charge a fee, if that gets queried i can always reduce it if i really want the business and i know it will still be worthwhile, so i include everything. Im not selling a Mortgage, thats pretty much a given, im selling my service and the relationship - how corny does that sound