Cancelling mortgage application

WillyP_2

My wife and I are looking to buy a house and were speaking to a mortgage broker at an estate agent. We had a house
lined up and were in a bit of a hurry so, on Saturday afternoon, we had an AIP and signed to apply for the mortga
ge. We then had a bit of a worry about the fact we might not have got the best deal (the broker wasn't whole-of-market) so I went into the branch first thing on the following Monday morning and said to stop everything as we want
ed to shop around and see if we could get a mortgage elsewhere with cheaper repayments. The broker said it was fin
e and nothing had gone through yet.

Later that day, the lender took money from our account so I contacted the broker who said he would go to the lende
r and get them to refund the payment. So far, so good. We then saw that the estate agent had taken the broker fee
from our account. I called the broker who said that the money is taken automatically as we'd signed the mortgage a
pplication and that it was non-refundable.

I know, up until signing, they can only charge 5.00 but, given that we have signed, do we have any right to our mo
ney back as they've not actually done anything yet..?

My feeling is that they're entitled to keep the money and, because of this, probably will..

W

The_J

Yep, the time to consider whether you went for the best deal was prior to applying.

WillyP_2

Yea, s'what I reckoned. No-one to blame but ourselves..

One thing I was wondering about.. The fees payed to the broker were the broker fees and a valuation admin fee. If
we found a better deal through an IFA, could we get him to use the estate agent to do the valuation admin since we
've already paid for it?

It would make sense, if possible, to get as much use out of the broker as we can..

The_J

The valuation admin fee is usually paid to the lender.

Make sure you factor in the costs of withdrawal into any new application. It may not actually be cheaper. What have you gone with out of interest?

WillyP_2

If we went through an IFA we've been speaking to instead of the estate agent's broker, we'd lose £498 (well, not lost - we'd still be able to go back to the broker in future, it's a 'lifetime' fee) and the repayments would potentially be £100 less a month which, over 30 years, is certainly worth losing £498 for..

The_J

Well you are unlikely to have the same mortgage for 30 years but £100 a month saving is significant if it is like for like (same term, same borrowing, both fixed/variable).