Mortgage broker not telling truth

j4the96

Hi All

I recently seen a house i was interested in and contacted the EA and requested a viewing. All good, was happy and wanted to put an offer in. I phoned the EA and was told another buyer was interested and had met the asking price - they would inform the buyer i was interested and take it from there. I was then told by the EA that the buyer wanted last and final bids from all interested buyers. The EA also asked if i would like them to recommend an Independant broker, to which I acceptd.

The following morning I met the advisor in the premises of the EA's.

She introduced herself as an independant broker and had no affiliation with the EA's - she just used a room within their offices. She then said if i was interested in the property and wanted to secure it i would have to up by initial offer by roughly £5,000. i did and my offer was accepted.

To cut a long story short, she has applied for a mortgage for me but required additional information i said i would get to her next week.

I was passing the EA offices today and had the additional paperwork with me, so thought i'd pop in with it. On entering the EA's office, I seen the broker sitting at the front desk of the EA's wearing their uniform. She seem shocked to see me, asked what i was doing here and seem quite eager to take the documents from me and usher me out.

This started alarm bells ringing as to how independant she really was.

When I got home, I done a bit of googling and found out that the company the broker works for has recently gone into partnership with the EA's and also the solicitor they have recommended for me has set up a partnership with them too.

Is this common practice ? or am i getting the wool well and trully pulled over my eyes here ?

Thanks
in advance or any replies

ACG

Well, i do work for an estate agents. But i dont work for them and am independant. They give me the clients details and they have anything to do with the mortgage from that point on....i just pay them a percentage of the commission on completion.
I also have a solicitor who i use if the clients dont have their own. I have a good relationship with them and because they get repeat business i get a good level of service off them - ie if something needs rushing then i can ask them to rush it and they will.
So, its not unusual that advisors will work with an estate agents and solicitors and in some cases it can work in the clients favour. However, if your advisor is lying to you about working for the estate agents, its not a good start is it really.

If an application hasnt been made, it could be worth looking for another advisor and going in and making her feel uncomfortable and saying thats what happens when you lie. If an application has already been made then i would say its probably best sticking with them.

If they have sold you any protection - dont go ahead with them and find another advisor. Thats where most of the commission is made so hit them where it hurts, in the pocket. (dont go to a bank though).

choclover

Hi there,

It's sounds a bit dodgy to me. Estate agents can have independant advisors working in their premises and also have affiliations with solicitors, however (and if I've read this correctly) what gets me about what you said is that the independant mortgage advisor told you that you would need to increase your offer by £5000! Mortgage advisors advise on the mortgage, they don't negotiate offers on houses!

opinions4u

choclover wrote: »

Hi there,

It's sounds a bit dodgy to me. Estate agents can have independant advisors working in their premises and also have affiliations with solicitors, however (and if I've read this correctly) what gets me about what you said is that the independant mortgage advisor told you that you would need to increase your offer by £5000! Mortgage advisors advise on the mortgage, they don't negotiate offers on houses!

The bolded bit highlights the big issue here.

Something's not right.

kingstreet

Did the "broker" give you an Initial Disclosure Document explaining the mortgage service you would receive and how she would be paid? This is an FSA requirement.

If yes, how does the name in the top left corner of the front page and the details in section 6 match/differ from that of the estate agent?

Conrad

ACG wrote: »

If they have sold you any protection - dont go ahead with them and find another advisor. Thats where most of the commission is made so hit them where it hurts, in the pocket. (dont go to a bank though).

Ask any broker to reimburse 30%+ of thier commission back into the policy as this makes premiums cheaper. Also compare thier prices using the internet, do not just fall for the line they are 'independant' as this can mean so many things and certainly does not necessarily mean they will offer the most competetive life assurance rates (perhaps they belong to a network that need a cut, as an example, which means there's less scope to discount premiums0.

ACG

Conrad wrote: »

Ask any broker to reimburse 30%+ of thier commission back into the policy as this makes premiums cheaper. Also compare thier prices using the internet, do not just fall for the line they are 'independant' as this can mean so many things and certainly does not necessarily mean they will offer the most competetive life assurance rates (perhaps they belong to a network that need a cut, as an example, which means there's less scope to discount premiums0.

Giving up 30% of your commission would make very little difference to the overall premium, the premium doesnt come down by 30%. Id rather just pay their first premium for them.
If any of my clients asked me to do that, i would most likely decline. If theyre prepared to argue over a few pence a month (just done a quote.. £2ish on a £30ish premium) i wouldnt be confident the business would stay on the books for the 2 or 4 years it has to stay on for. So i would decline, explain why and then its their decision what to do.

I know i do a good job and i value the service i give, doing what you have suggested makes it look like your trying to compete with the price comparison sites and devalues the service and advice you provide in my opinion.