Finding a whole of market mortgage advisor

appolospb

Hello again.

Based on the advice given on this forum I have been trying to source a ‘whole or market’ mortgage advisor based in Essex (Chelmsford). I don’t really know where to look to find one so I searched on Google and found a couple of providers which I have emailed. If there is a main source for finding a good mortgage broker then I would appreciate this information?.

Can you please tell me if the information they have given me sounds right, the costs in particular seem a little steep and the details sketchy and conflicting.

Provider 1:

Hi
We are Independent Mortgage Brokers, so we offer a fee based service, or a non-fee based service – just depends on the size of the mortgage. If the mortgage will be below £100k then we will charge £299 to cover our immediate costs, else we will normally charge you nothing for our service.
We would like you to use our recommended services for Conveyancing and Insurance, which are not expensive (normally cheaper than you can get those services!) – this would cover any loss of fees.
We review over 10-0 different lenders, so we are better than ‘Whole of Market’ which you can be with just 10 lenders – we have arguably one of the widest choices of lenders for our clients.
So in answer to your questions, we don’t normally charge fees and we are more than ‘Whole of Market’.


Provider 2:


Hi
Yes, we are a whole of market independent mortgage broker, we are not estate agents so therefore are only offering un-biased financial advice and not trying to tie in a property sale to you at the same time.
We do charge a fee for arranging your mortgage, not for the advice. The reason for this is banks pay a very small percentage of the loan amount as a commission which we don’t receive 100% of, we therefore charge a flat fee payable upon receipt of a mortgage offer to all clients. The mortgage offer is the very last part of the mortgage application process, we do not charge any upfront fees.

kingstreet

How much do you need to borrow and are you a "high street" prospect?

Dave_Ham

I think this is one of the most common issues in the mortgage marketplace right now and fair to raise.

If I was not educated in this, the fees and commission and whole of market vs tied vs independent vs rubbish broker vs good broker must be very difficult to manage from a perception point of view.

Neither of these make it clear what you would be paying, Provider 1 wants associated sales included and what if you do not use theres - increase in cost I do not know.

Provider 2 charges at offer, but does not stipulate how much..

I would suggest you e-mail and ask for clarity and also check that they will search the entire market including direct only deals and obviously the exact costs...

For example if you paid a £500 fee, but saved £2,000 vs the best commission paying deal I am sure you would be happy to pay the upfront money.

I personally would be interested in how they come back to you...

Good luck

appolospb

kingstreet wrote: »

How much do you need to borrow and are you a "high street" prospect?

Not sure exactly what a 'high street pospect' is. I dont have a figure i need to borrow yet as i am after a agreement in principal and havent found a property yet. However i suspect i would be after borrowing around £140 - £150k and have a £25k deposit with the potential to get a further £10k deposit. I earn £30,300 + £2k guranteed overtime and have 0 dependants, 0 debt. I would be applying as a single applicant.

So searching google is this the best way to find a whole or market broker?. I guess there is no website like Rightmove for this line of work.

As a potential customer i find the whole situation totally confusing and off putting. There must be so many people out there like me that just want to find out how much they can borrow and find aquiring this information a bit complex. At the moment i am a bit worried they will just direct me to the lender that pays the best commision.

Dave_Ham

Its a common perception problem (thanks to the bad brokers) and one the industry needs to work together to overcome.

On your assumed prices, the procuration fees for placing this business would be similar across all of the mainstream lenders and be around £400 to the broker.

Yours is a very straightforward case from what you have said, so a broker should find it easy to find you the best terms.

I would ask the same direct question of your local brokers and see what they say, the mortgage value would probably be slightly lower than average for your area but not by much..

As I said, do keep us posted and dont lose faith looking for the best advice as sensible cost.

Good luck

kingstreet

A high street prospect is someone who is likely to get a deal from a major lender at the better end of the rate options available in the market.

A whole market broker is one who considers only deals which pay him a commission. On the size of mortgage you are describing, £140k, the typical commission will be around £450.

You should be able to find a broker who will accept this alone and will not charge you a fee or make any other products conditional.

If you want details of products which don't pay a commission, you need someone offering independent mortgage advice. For this, you will pay a fee but if the broker receives any commission, this will be rebated to you to subsidise any fee payment.

So, an independent broker may give you back £450 and this may be more, or less, than the fee you agreed to pay.

If a direct to lender product with no commission is better for you, this will be recommended but of course there will be no commission to subsidise the fee. So you have to ask yourself if you could find the direct deal yourself and save paying the fee altogether.

This site https://www.unbiased.co.uk lists brokers in the areas you desire. Switch off the website/email only option and you'll get a full list, not just those paid for adverts you first see.

dunstonh

So, an independent broker may give you back £450 and this may be more, or less, than the fee you agreed to pay.

Its not a case of "may give it back" but "must give it back" or offset it against the fee. Of course, that assumes there is commission.


For many people, using an independent mortgage adviser and employing them on independent basis (important as they can also be employed on whole of market basis) can usually be the most cost effective for advice unless your mortgage is small.