Broker or Direct with First Direct

suburb25

Hi all,

I know there are lots of posts on here about whether to go direct or go through a broker but I was hoping to get some advice about my own situation

I have met with a broker and he has told me the best rates for a 90% mortgage are 5.69% with Santander. I am a First Direct customer and on their site they have 90% mortgages for 4.69%

I have a good credit report, no missed payments/defaults on any of the three reference agencies recommended on this site.

I'm not a first time buyer but I am currently coming off another mortgage as I am being bought out. I should be off this shortly.

What I would like to know is the likely hood of First Direct lending to me. The online calculator says based on my salary they could lend up to £139,500 which would work if I am looking at properties of around £150,000.

I am concerned about going through the application process with First Direct and getting turned down as I know their criteria is strict and this then affecting my chance of getting the Santander mortgage via my broker.

It just seems that the rates at First Direct are too good for me to not at least try and get a DIP from them

Any advice would be much appreciated

Thanks

Dave_Ham

Given the information you have detailed being accurate, it sounds like First Direct application in my opinion.

If you are self employed, contracted, in probation period then my opinion may change.

That said Santander are as fussy as First Direct in any case, so not much of a goto plan.

All the best

ACG

You say your on a mortgage at the moment, does that person have any defaults, missed/late payments, CCJs etc?

The reason i ask is that during a credit check you may be deemed as being financially linked to that person and that will have an effect on whether your accepted or not.

As Dave says though, with no issues you should have no problem getting a mortgage your not looking for the maximum they will lend so unless you have any other debts (CC's, Loans, HP etc) then you should be ok going off what you have said.

suburb25

Not self employed or in a probation, been with company for a few years.

I think the broker's reasoning was that Santander or Halifax would potentailly lend more than First Direct, but then obvioulsy the monthly repayments would be higher as we would be borrowing a higher amount and paying a higher interest rate. I don't want to borrow as much as we can just because someone will lend it. But then I would also like to get the best property that we can afford and not just buy somewhere because it's the only place in our price range!

Thanks for your advice though

suburb25

Thanks ACG, no they have no defaults or CCJ's either. It does come up on my credit report that I am linked to them so I have checked this with them as I thought this might be the case.

If I was looking at the maximum they would lend, would this affect my chances? How accurate are these online calculators?

As I said FD calculator said I could borrow up to £139,500 and the broker said I could borrow up to £155,000 which seems like a big difference to me!

bigmatt1174

Having a quick look around based on property value of £155000 with 10% deposit you can get a fixed at Britannia till 31/12/2015 at 4.79%, Chelsea BS at 4.24 till 30/11/2014, - there are a lot of 90% deals less than 5.69% - not sure where the broker is looking!

Conrad

Yes, lots of tasty direct deals. Only use a broker if you have a complex situation otherwise you will always miss out on all the direct deals, unless the broker is fees only and thus properly unbiased.

Being fees free is the worst money saving tip I can think of. Nothing is free.

ACG

You can use an Independent broker to pick out the deals that are available direct - just not a whole of market or tied broker.

If your financially linked, you could do with getting it updated with experien/equifax etc but if their credit is fine it wont affect the amount you can borrow.

the reason for the difference is lenders have different calculations, they take different risks etc so i wouldnt worry about that too much. FD are known for being quite selective so their affordability calculations will be more stringent.

bigmatt1174

ACG wrote: »

You can use an Independent broker to pick out the deals that are available direct - just not a whole of market or tied broker.

What is the difference between an Independent Broker and a Whole of Market broker - are they one in the same?

ACG

No, im a whole of market advisor i have access to everything EXCEPT deals that are available by going direct (Which includes first direct, co-op, post office, HSBC - i think thats about it?)

bigmatt1174

ACG wrote: »

No, im a whole of market advisor i have access to everything EXCEPT deals that are available by going direct (Which includes first direct, co-op, post office, HSBC - i think thats about it?)

This does not preclude you from being classed as Independent. Under the FSA definition for an Independent Mortgage Advisor to be able to class themselves as Independent they have to do the following:

1) Offer a whole of market proposition
2) Offer a pure fee option for payment

As long as you do both of the above you are independent.

If a broker looks at all deals and then does not give the client the option to pay them a fee they are NOT Independent.