Is this IFA feeding me lies?

benjdr

Hi,
I've just been on the phone to an Independent mortgage adviser, and I got the impression that the person I was talking to was not being totally honest with me.

We started talking about fees and what the term "Independent" means.
The IFA told me that they charge a fee of £199, but mumbled about some "other fees" that might occur (I heard the word survey mentioned), and "its all about finding the best deal for you".

I then explained that I understood the term independent to mean that the IFA had to offer the opportunity to pay an upfront fee and rebate the commission.
AGAIN the person started mumbling, tripping over their own tongue, and ended up basically saying "no we don't do that". The IFA told me that is generally only a practise associated with investments.

We talked some more for a brief time before I ended the call as within only a matter of minutes and felt I was being lied to.

I'm seriously going out of my mind finding a broker I think I can trust, and is doing their best to serve my needs.

All advice and comments are most welcome, and if someone knows a decent broker in the South Wales area, please pass on their details.

Cheers.

herbiesjp

It sounds like the people you were talking to didn't have a clue

A fee free whole of market adviser may be just as good an option

HTH

MortgageMamma

Sorry we are not allowed to recommend anyone on here as we are brokers and there is a potential conflict of interest. I have been told in the past that wales has a shortage of brokers - ring around a few others firms and see the response you get. Has anyone in your family or friends used a broker?

What is your preferred payment option, commission only, fee's then commission rebate, fee's only and no commission rebate? Are you aware there are none commission paying lenders which are sometimes omitted from a brokers research as they can't earn from them?

Mr_helpful

use a search engine and type in something like whole of market no fees broker

benjdr

MortgageMamma wrote: »

Sorry we are not allowed to recommend anyone on here as we are brokers and there is a potential conflict of interest. I have been told in the past that wales has a shortage of brokers - ring around a few others firms and see the response you get.

Maybe so yes. Maybe i'll resort to an broker from elsewhere using the internet or over the phone eventually, but ill persevere for now.

MortgageMamma wrote: »

Has anyone in your family or friends used a broker?

No, not recently at least.

MortgageMamma wrote: »

What is your preferred payment option, commission only, fee's then commission rebate, fee's only and no commission rebate?

Is there any really between the first two options?
I guess minimising cost would be a priority, but I guess I'm open to some advice here...I don't see why someone would choose to pay when you can receive the same potential service for less cost.

MortgageMamma wrote: »

Are you aware there are none commission paying lenders which are sometimes omitted from a brokers research as they can't earn from them?

No, I wasn't really.
If this is done can a broker called themselves WoM?

Thanks very much for your advice again.

dunstonh

In your post you switch between independent mortgage adviser and IFA. Which was it?

Independent in mortgages has a different meaning to independent in investment class and IFAs are investment advisers, not mortgage adviser. They can still do mortgages but they wont have their IFA hat on but mortgage adviser hat on instead. Maybe that is part of the confusion. For example, an IFA can be tied on mortgages to one provider but can still call themselves an independent financial adviser. You are unlikely to find many single tied but you will find a number of multi-tied/panel based.

If you choose fees with an IFA dealing with IFA business then any commission would be rebated. However, with mortgages there is no requirement for them to offer a fee only option as mortgages do not fall under the IFA remit.

payless

I'm surprised if an IFA ( investment -= at least offering a fee based service) who also does mortgages would not offer an independent mortgage service, with fee based ( rebate comm) option..

benjdr

dunstonh wrote: »

In your post you switch between independent mortgage adviser and IFA. Which was it?

Independent in mortgages has a different meaning to independent in investment class and IFAs are investment advisers, not mortgage adviser. They can still do mortgages but they wont have their IFA hat on but mortgage adviser hat on instead. Maybe that is part of the confusion. For example, an IFA can be tied on mortgages to one provider but can still call themselves an independent financial adviser. You are unlikely to find many single tied but you will find a number of multi-tied/panel based.

If you choose fees with an IFA dealing with IFA business then any commission would be rebated. However, with mortgages there is no requirement for them to offer a fee only option as mortgages do not fall under the IFA remit.

I've just checked and they do quote themselves as "Independent Financial Advisers". Sorry about the confusion.

Still, I find it amazing the person I spoke to couldn't explain that or answer any my questions coherently.

Thanks very much.

dunstonh

I know of two that operate IFA and multi-tie in house and put protection and mortgages through on a panel (although they can go off panel). Only investment class business goes through the IFA classification.

However, I think if you are an IFA, you should be independent on all three classifications and not just investment class. However, the FSA with depolarisation don't think that way and prefer to confuse everyone.

Still, I find it amazing the person I spoke to couldn't explain that or any my questions coherently.

If you dont have the confidence of that one individual, then find another. There are plenty out there. Maybe get a mortgage adviser rather than an IFA. Or at least get an IFA that is a mortgage specialist. You need to have confidence in your adviser.

MortgageMamma

I agree with you Dunstonh

To the OP

If you pay a fee, then it will ensure that the advisers is not commission biased when making his recommendation. I'm not saying that he/she would but, but theoretically charging a fee shoudl reduce the likelihood of this

You should ask the mortgage adviser if they will be including non commission paying lenders, and lendrs who offer special direct deals not available via brokers in their research. Sometimes these can be more competitive. If he does recommend a product where he does not earn commission then your fee should pay for that, if he recommends a product that pays commission then it would be ncie to have that upfront fee rebated.

Some brokers will quote by the hour for fees and some will give you a set price. If you go to an hourly charger make sure you set a ceiling limit.

Our industry and how it works is complicated enough for brokers to understand so I pity an individual who has to make these choices. For more information you may want to have a look at another thread I started a few days ago, with a poll on it. I think it was entitled "what do you expect from a broker" and its all about fee's and what is fair on a customer.

MM

Ps - apologies for the spelling if its bad I stood on my glasses this afternoon so am touch typing

benjdr

MM,
Thanks so much for this (and thank to everyone else too).
The information you provide is proving to be invaluable and is much appreciated.

I have indeed read your other thread, but I think I'll go read it again a few more times to make sure all the information sinks in.

Thanks again.