First time buyer confusion - are Connells ripping me off?

ConfusedofYorkshire

Tommo99 wrote: »

Keekles, I think that's very true in this case - I owe the broker something after all he's done for us!

What do you mean when you say "Have you indicated to the broker any restrictions on paying upfront (arrangement etc.) fees?"

I phoned up again and explained about the rates. A better one has come on today which is cheaper than even L&C quoted (though I'm sure they now have access to it too).

I am told the surveyor is dictated by the mortgage lender... not sure if this is entirely correct, however it certainly saves us booking and arranging the survey and the £399 we pay Connells "insures" our survey fee so we don't lose out if the sale falls through.

I will drive to get the best solicitor deal I can, but I think it is probably worth taking the hit at this stage, accepting that I could be losing a few hundred pounds, but safe in the knowledge that someone is doing all the behind the scenes for me and it is moving quickly.

I certainly won't be using their home and contents, will or life insurance services though. Rip off!

Many thanks for all the advice so far.

But any broker would oversee it for you so I'm not sure you're gaining much. From what you've said I don't think I'd go with them

You lender will organise a valuation. Through nationwide this is 235. You can upgrade this to a homebuyers survey so you then pay about 450.

If you were to get the homebuyers survey separately though a different company it would probably be from 350 and you'd still have to pay for the lenders valuation so it's cheaper to use the lender option.

Tommo99

So they quoted me £619 for a homebuyers survey, which breaks down:

£405 valuation fee
£65 valuation administration fee
£149 valuation and administration fee

Are you telling me that the £65 and £149 are going to Connells and only £405 of it to Nationwide/Surveyor?

I didn't specify any limitation of upfront fees so that shouldn't have cut any mortgages out.

Chack48

It is your decision but I'm also preparing as a FTB and come to a conclusion that there is no much value for going 5 years fixed rate. If you go for 2 or 3 years fixed rate then there would be much better interest rate available. Halifax is offering 3.14% with your LTV, no product fee, no mortgage account fee and £650 cash-back.

ConfusedofYorkshire

Tommo99 wrote: »

So they quoted me £619 for a homebuyers survey, which breaks down:

£405 valuation fee
£65 valuation administration fee
£149 valuation and administration fee

Are you telling me that the £65 and £149 are going to Connells and only £405 of it to Nationwide/Surveyor?

I didn't specify any limitation of upfront fees so that shouldn't have cut any mortgages out.

That sounds like a he'll of a lot! How much is the house? Mine is 220k, so I pay 420 (sorry got figure wrong above) for the survey, including valuation. This is through a broker but that's also what you pay if you go direct

http://www.nationwide.co.uk/mortgages/usefulinformation/mortgagefeescharges/feesandcharges.htm#e

Yorkie1

Irrespective of which broker (if at all) you use, the lender will instruct their own valuer. You then choose whether to use the same person to do any surveys for you, or to instruct an independent person. Chances are that the £399 Connells fee will be more than you pay the lender's valuer or an independent.

Irrespective of who you use as a broker, you have to deal with the solicitor yourself.

Edit: I agree with the others, who posted faster than I did!

Tommo99

Hmmm... this is such a headache!

So I appreciate now that I could save, realistically, £548 straight away because that is what Connells are getting from me. I can find the same mortgage myself online, and can use the lender to book my survey.

However... I want things to happen as fast as possible, and I can't afford to take days off work to get things moving.

I guess that my decision comes down to whether I think it is worth £548 to have my survey costs and conveyance costs covered against the sale falling through, and to have a friendly voice on the end of the phone any time I need, and I think it quite probably is... this is at the very least a very good learning experience for future.

I've had a look but I can't find reputable fee free brokers in my town, though there is a good one 20 minutes drive away. It just means delaying the process, and that's the problem.

House is £270,000.

ConfusedofYorkshire

Tommo99 wrote: »

Hmmm... this is such a headache!

So I appreciate now that I could save, realistically, £548 straight away because that is what Connells are getting from me. I can find the same mortgage myself online, and can use the lender to book my survey.

However... I want things to happen as fast as possible, and I can't afford to take days off work to get things moving.

I guess that my decision comes down to whether I think it is worth £548 to have my survey costs and conveyance costs covered against the sale falling through, and to have a friendly voice on the end of the phone any time I need, and I think it quite probably is... this is at the very least a very good learning experience for future.

I've had a look but I can't find reputable fee free brokers in my town, though there is a good one 20 minutes drive away. It just means delaying the process, and that's the problem.

House is £270,000.

It sounds like you're also getting a less competitive mortgage rate which will also cost you more?

My broker is a recommendation from a family friend. He isn't saving me any money as I get the same deal direct but he is saving me time. The law firm is a small independent and very efficient. I wouldn't want a big national firm

Tommo99

No, since I started the thread they have found me the best mortgage I have seen so far, though I could also get it direct.

ConfusedofYorkshire

Ah I see! Well if you're confident they'll be speedy then go for it. Having your survey and fees covered is good, but make sure you read the fine print. Are they covered in all circumstances etc.

amnblog

Hi Tommo

Your overall situation will dictate the lenders than Connells recommend from the panel available to them.

The Nationwide 5 year fixed rate can be bettered on overall cost (over 5 years) by a number of lenders but there may be factors in your circumstances that mean that these other lenders are not suitable.

A little knowledge is a dangerous thing they say and if you check on the Nat West site for example you will find that they do not do a 3.79% 5yr fixed rate for first time buyers no product fee. Their no fee product is £4.09. Therefore the do it yourself method carries risk.

What to do?

If you are unsure you are getting what you need from Connells you should not use them. Any number of whole of market brokers could sort this out for you over the telephone this afternoon and allay your fears.

Alternatively, you could go back to Connells and ask them to provide you with a 5 year costing comparison from their panel indicating why Nationwide is being recommended other lenders.