Mortgage and income protection cover advice

dunstonh

An IFA will trounce an FA. Not just in price but in quality. Some of the best income protection plans dont come from the mainstream insurers but the friendly societies. An IFA can access all these. The FA cant.

The_J

dunstonh wrote: »

An IFA will trounce an FA. Not just in price but in quality. Some of the best income protection plans dont come from the mainstream insurers but the friendly societies. An IFA can access all these. The FA cant.

This is interesting to me, it's not something I really take much note of. What kind of differences are we talking about? Cost/cover/features?

sammybee

i have emailed a local IFA which i found on the unbiased link, i have asked the following questions

hi, we are looking to get a mortgage of around £50,000 for 20yrs and possibly life/critical illness cover, can you answer the following question s to see if you are suitable for us to set this up .

What are your fees and when do we pay ?

How long have you been established?

Are you authorised by the Financial Services Authority ?

What qualifications do you have?

i look forward to speaking to you
sam

hope i havent missed anything out

sammybee

i have just received a private email,

.SENDER ASKS ... You state you spoke to L&C, how did that go? They should be able to help with what you require with no fee whereas an IFA will generally charge a fee. Given your mortgage size paying fees would be worth avoiding.

I would post this on the thread but do not wish it to become a slanging match between IFAs who think fees are worth it and the "moneysavers" who think they aren't.

All the best,
" " "
so now my question is who would be the cheapest and save just as much for me ........ L & C or an IFA ??????

dunstonh

sammybee wrote: »

i have just received a private email,

.SENDER ASKS ... You state you spoke to L&C, how did that go? They should be able to help with what you require with no fee whereas an IFA will generally charge a fee. Given your mortgage size paying fees would be worth avoiding.

I would post this on the thread but do not wish it to become a slanging match between IFAs who think fees are worth it and the "moneysavers" who think they aren't.

All the best,
" " "
so now my question is who would be the cheapest and save just as much for me ........ L & C or an IFA ??????

An independent will cost you a fee but will include the whole of market in full (deals that L&C and whole of market advisers will not) and rebate any commission if the mortgage pays a commission.

L&C or a whole of market adviser wont charge you a fee but will only look at commission paying deals.

On a large mortgage, an IFA should easily come in cheaper with a reasonable fee. Lets say the fee was £750 and they recommend a mortgage that pays a commission of £1100. In that case, the IFA would refund £350 (£1100-750) to you when the mortgage is complete. Whereas L&C (or other whole of market brokers) would not refund a penny.

Or lets say the best mortgage for you is non-commission paying and over the term of the deal saves you £2500 compared to the best commission paying deal. So, L&C will cost you £2500 compared to £750 for the independent.

For small mortgages, commission can often be the better option as the small amount borrowed wont generate enough commission to be greater than the fee. Or the difference in the non-commission deals and commission deals wont be as noticeable.

It's a shame that you got a PM like that because it is inaccurate and doesnt allow for corrections. Luckily you had the common sense to post it on the board to get it discussed.

sammybee

thanxs dunstonh for the reply, i am still waiting for the reply from a local IFA we have not got many working in the local area and i would prefer to speak to one face to face and not by telephone, so then i can weigh up all my options, i ve just been reading the mortgage guide also, i will definately be dong all the add ons seperately. Hope these threads help others in the same predicament as myself, i would of got well ripped off from the mortgage advisor at entwistle green

sammybee

More info sent to me to consider ....
The commission from a 50k mortgage will be about £250. So if you pay £750 you'll be down £500 compared to a Whole of Market broker. If they find you a cheaper rate from a non commission source you may save money over a fees free broker, it may just about be more than the "fee" you pay the IFA however you can source these products yourself on confused/moneysupermarket etc. once you've spoken to a broker to find out what, if any, the issues are with your situation.