Searching for a mortgage - comparison websites

littlevet1

Hello all

We're in the process of searching for a mortgage and although we have enlisted the help of a broker, we are also doing our own research. We are looking for a fixed rate deal for 2-3 yrs. We are first time buyers.

My first question is: am I right to be comparing mortgages by looking at the "actual cost over x years"? We would remortgage when the fixed rate comes to an end. Or should I pay more attention to the overall cost for comparison % figure?

I have been playing round with figures on moneysupermarket.com and moneyfacts.co.uk, comparing the actual costs over the fixed rate period including fees. Based on a property value of £210k and a £55k deposit, these two websites give totally different recommendations!

For example, looking at a 2yr fix:
Moneysupermarket.com says Market Harborough BS is the best deal, with a 2.69% initial rate fixed for 2yrs. Actual cost over 2yrs is £19,926, with an arrangement fee of £1500 (added to mortgage), and other fees of £240 (valuation fee) and £95 (booking fee) due up front.

Moneyfacts.co.uk on the other hand doesn't even list Market Harborough BS in the top 10, instead picking Yorkshire BS as the best buy - 3.19% on a 2yr fix. Actual cost over 2 yrs is £18,505.56 and the arrangement fee is £495. Moneyfacts doesn't give any details of valuation or booking fees.

The YBS mortgage does feature on the moneysupermarket list but gives an actual cost over 2yrs of £20,905.28, compared to £18505.56 quoted by moneyfacts.co.uk. A difference of over 2k!! I think I can see where some of the discrepancy comes from, because moneysupermarket uses an arrangement fee of £800 (added to mortgage) and adds up front valuation fee (£325) and booking fee (£195)

Looking on the YBS website, the actual fees for FTBs taking out the 3.19% 2 yr fixed rate deal are: arrangement fee £495, with £195 payable on applicaiton and the remaining £300 added to the mortgage. The valuation is free. So the figures given by moneysupermarket are definitely incorrect.

My question is: are these comparison sites ever accurate?! Are there any better tools that I can use to compare mortgage products accurately? I certainly hope my broker has a more sophisticated method!

Thanks in advance for any comments

The_J

You can largely ignore APR.

Price comparison websites don't really work except in the most straightforward of situations. I personally think they confuse more than they help and hopefully the FSA will stay true to their word and force all mortgages to go via the advised route and shut these awful institutions down. Maybe then I can sit down with Mrs J and watch Britains Got Talent and not be subject to their horrendous wailing during the ad breaks.

handytips

Bit of free advice for you. The internet and in particular comparison sites are a very dangerous playground, lots of people just do not qualify for the deals that they show. lending at the moment is tough, some lenders are way behind with their applications, HSBC, Yorkshire, Barclays. some like to say yes and then weeks down the line it is NO (HSBC). Therefore what you are talking about is important, however the most important thing is the Offer. Why mess a broker around if you are going to TRY and do it yourself. A good broker will know criterias required for products and lenders and believe me when i say. The rate really isnt the most important factor when sourcing a mortgage.

handytips

Also in answer to your sourcing question, Yes brokers do have a far more sophisticated sourcing tool which will show all products both direct and only via intermediaries, we can also apply filters to basically narrow the choice down. By the way WE have to pay for that facility on a monthly basis.

littlevet1

Thanks for your replies.

Handytips - we are using a fee-charging broker following a personal recommendation and have been very happy with their service so far, however I see no reason why we can't do our own research as well. We certainly aren't messing our broker around, but just want to make sure that we are well informed when considering their advice.

handytips

All i am saying is this. Many providers are way behind or just do not want to lend at the moment so worrying yourself looking at other products is counter productive. By all means question your broker as to the choice they have made and i can almost bet my bottom dollar it will be with Santander Halifax or Principality as these are amongst the few lenders with the appetite to lend. Comparison sites are constantly under the spotlight, read the Which report on them. Tells the story well. Good Luck

LLouiseR

When I was looking to buy last year I used the governments money advice service's comparison tables. From that I selected about 10 lenders and then went to their sites and then did the quick - what will you lend me? calc.
APR's are useful - but only if your comparing like with like. I was very lucky with the mortgage deal I got, but if I hadn't had it then the decision became more complex - was i better off paying a fee? or going for one where I paid a fee but had a lower rate of interest? so I started doing individual calcs for myself.
If I had £55K deposit and was prepared to pay £1800 in fees on top I considered my total available deposit to be £56,800 (if no fees), therefore if I paid only £500 for my fees my available deposit was £56300 and that is the figure I used to calculate the costs on the individual lenders website. Obviously it varied from lender to lender and deal to deal, but once you get the hang of it it gets easier. I may be wrong but I don't think that comparison websites do that, which is why I avoided them!

Thrugelmir

Unbised comparison can be obtained from the FSA website where the vast majority of lenders post their mortgage products.

http://tables.moneyadviceservice.org.uk/Comparison-tables-home/Mortgages/Compare-mortgages/

fimonkey

Thanks, though that comparison site doesn't filter by LTV.

Thrugelmir

fimonkey wrote: »

Thanks, though that comparison site doesn't filter by LTV.

Bases the search results on purchase price and mortgage required ( = LTV).

fimonkey

Even if a broker is whole of market there may still be deals which are cheaper by going direct. My broker has just honestly told me this and has said I would be better to apply straight to the lender for a certain deal which is not open to him, and then get back to him if there is a problem. .. Good to see honesty like that, I will certainly recommend him to others even if I end up not using him.