Using an IFA for mortages

addedvaluebob

dunstonh wrote: »

for reference, addedvaluebob supports the use of CMCs when posting in the reclaims section. So, you have to excuse his anti-adviser bias.

Its not bias its balance. Everyone posts and says don't use a CMC because they don't do anything you cannot do yourself for free. If people use the wide ranging resources available on the web they can do the same as a broker and in many instances have availability to the same loans. I'm not anti-adviser, I am for balance in postings

addedvaluebob

magpiecottage wrote: »

For the OPs benefit, the fee a mortgage broker charges will go towards:

Sourcing software. This is a realtime online system which can change by the minute, not something on Google which may, or may not, be up to date. There is a subscription for this which is not cheap.

Compliance costs. This is not simply paying an annual fee to the FCA. They also have to pay for time spent submitting reports to it. They have to pay a levy to both the Financial Ombudsman Service (even if they do not use it) and the Financial Services Compensation Scheme (to pay for the mistakes of other advisers who have gone bust).

They have to pay for professional indemnity insurance.

They also have to pay for software to monitor compliance and spend a great deal of time using it (or pay for somebody else to do it).

Then you have all the other costs common to any business. You have to rent your premises, you have to insure them. You have to have employer's liability insurance. You have to maintain equipment. You have to heat and light your premises. You have cleaning costs. You have business rates. You have travel costs. You have staff salaries. You must factor in the cost of employer's national insurance on that, plus pension contributions (which are becoming compulsory).

These are all costs which an employee, such as a nursing home nurse, would not have to meet - but they are employer's costs.

On the other hand, if you were to consider how much it costs to keep somebody into a nursing home for a week and divide that by the amount of time the nurse actually spends attending to that particular resident it will be a lot higher than the actual hourly rate that the nurse is paid.

Again, though, you can save that money by nursing your elderly relation at home - getting them up, washing and dressing them, possibly in between getting your children up and off to school, fetching them from school, checking their homework, feeding them and packing them off to Scouts or Guides, bringing them back, parents' evenings and of course your own job.

So yes you can save money but you need to consider what it will cost you in terms of time and stress.

All of which applies to any other professional in any other line of work. The cost in 'time and stress' is just a myth put out by the financial services industry to support the idea of paying them for something you can do yourself

andyfromotley

addedvaluebob wrote: »

All of which applies to any other professional in any other line of work. The cost in 'time and stress' is just a myth put out by the financial services industry to support the idea of paying them for something you can do yourself

But not in this case. Having ran a mile at the thought of a £350 fee, the one thing the OP has singularly failed to do is obtain a mortgage. So perhaps in his case it obviously wasn't something he 'could do himself',

Let_Us_See

addedvaluebob wrote: »

The cost in 'time and stress' is just a myth put out by the financial services industry

Which is back up by thousands of stressed out posters on this forum?:cool:

Anyone can apply for their own mortgage, and long may this last, but advisers provide added value and experience and many charge a fee. Personally, I charge a fee to ensure I don't have to deal with clients such as the OP, who has been unable to obtain the required mortgage, and decides to vent his frustration on fee charging advisers.

amnblog

I am not balanced Bob.


I advocate using a broker in most posts - why would I not when most of the issues on here are down to lack of knowledge - knowledge that experienced brokers have.


The 'cost of time and stress' is not a myth and you would appreciate if you spoke to many of our clients who were banging their heads against a wall before we sorted them out.


if there is a simple answer to a simple question, I try to give it - but in most cases it is more complex that that.


Every day we are sweeping up after potential borrowers have crashed and burned by going it alone.

ACG

I have a slightly different opinion to amn in that I think if you and the property are "vanilla" (which is subjective in itself) and have the time and inclination the average person is capable of sorting it out themselves without too many issues, but whether they should or want to is a different matter.

However it would be stupid to class time and stress as a myth. Even straightforward cases have issues and depending on the lender that can be a nightmare.

I have a client who found a property last month, I went off and did the research and he did his own - we came back with different deals. His was cheaper but I knew they would not accept the property (which is why I discounted them). Now he would only have found that out after submitting the application and paying £355 for a valuation as it would not have come up at application stage - so even if I did nothing else, I have covered my fee.

As it happens his offer was rejected and he found a new property.

Again, we both went off and found a new deal for the new property and we both came back with the same deal (the cheapest). I very much doubt he checked criteria but he may have learnt from his previous mistake.

So moral of the story I suppose is that of course you can find your own mortgage, you can also check criteria but would you know what to check? Did he get lucky the second time or did he do what I did? I still got the mortgage as he would have had to wait 2 weeks for an appointment with the lender in question which in itself is another plus point of a broker.

My favourite customers are typically the ones who have either tried themselves and had it declined or been to another broker - they appreciate what I do the most and are more likely to sing my praises to friends and family. But as I have said all along, I would never say people should use a broker.

Each to their own, there are reasons for and against but if I genuinely did not think there was a point in my job, I would go and change career.

As per my decorating post earlier, I paid someone to do my living room, but I did the spare room myself as 1) its not as important and 2)its about half the size.

amnblog

ACG wrote: »

As per my decorating post earlier, I paid someone to do my living room, but I did the spare room myself as 1) its not as important and 2)its about half the size.

Who did the better job - quicker?

ACG

I did the better job (even my gf said so and she would never say anything nice about me for fear of me getting a bit head), the decorator cut corners (no pun intended) around the radiators. But I am a bit anal about doing things right when I do it.

In terms of speed he did a 16ft living room in 8 hours, I did a 8ft room in about 20 hours. I sorted out the bits he cut corners on in maybe 1-2 hours but I would probably still be doing that room now 3 months down the line if I did it myself.

amnblog

I have known a friend of mine to take every weekend for three months to decorate a single bedroom.

It was beyond immaculate, like a Dulux ad in a magazine.

davilown

A broker is as good as the job they do and, as such, should be paid accordingly.

I used an IFA (whole of market) as a FTB 3.5 years ago. his charge was £120 + commission. We spent 2 hours with him, resulting in the best mortgage available from a source he was unable to obtain (Santander). His advice? Go direct to the bank as it will save you alot compared to me arranging with another company. In addition, he had also ensured we had all the correct paperwork required to aid with the decision.

Paid £120, left with very good advice and a happy customer and we believe could have charged more.

2 years later, we remortgaged. This time, I searched the market myself, identified what I deemed to be the best product for our situation and applied on my own (West Brom). Bar a few additional payslips and CT invoices, it was easy.

As background, we were financially sound, both with secure jobs and no debt.