New Build: Have to use their broker?

lc_racing

Hi all,

We are first time buyers and are looking to use the Help to Buy Equity Loan scheme. We are looking at a Persimmon (have read some mixed things about them so slightly concerned anyway!) new build property.

We are in a reasonably good position and already have a decision in principle for a mortgage. However Persimmon are insisting I go through their Mortgage Broker BEFORE they will take things any further. They have advised this is to check whether we are able to obtain a mortgage and "offer us a better deal".

I cannot see any reason why I need to do this, as we intend to use the lender who has given us the AIP, is this not evidence enough that we can obtain a mortgage? Is this not just a sales technique so they can earn their commission off of the broker?

Are Persimmon able to force us to use their broker? Any advice would be greatly appreciated.

Thanks in advance

tecnospy

Hi,

I'm buying through Bellway and they said that I would need to speak with their broker to get a reference number before I would be allowed to reserve, even though I'd already got a DIP from an independant broker. So I duly phoned them and said I needed the reference number and they took a few details and then came back to me with it, no hard sell (but that could be different with theirs).

When I went back in to reserve the plot, Bellway didn't ask for the reference number when I said I was sticking with my broker!!

I suppose the answer is if they can get you a better deal and have reasonable costs then consider it but there are a limited number of mortgage companies that loan to H2B equity loan properties and an independent broker might offer a better service..

Mobeer

Are you sure they mean you have to get a mortgage from their broker, or merely to talk to their broker? Whenever I or anyone I know has bought new the builder has insisted the buyer talk to the builder's broker. This doesn't mean you have to use their advice.

Kell4life

I believe you have to use their broker initially, they check you can afford the property and get the mortgage required. The broker will then say you are ok to proceed and you can then either chose to use their services or find your own. They can't force you to proceed with their broker. The builders won't take you seriously until they know you can obtain the mortgage amount.

lewishardwick

I think the're just trying to filter out day dreamers with serious buyers.

When I put an offer on a property (not new build) they insisted I speak to their Broker before it would be put forward. Broker basically went through the same questions and detailed mortgage calculator does and came up with a few figures. They then asked if I wanted to use them, I politely declined as I already had the DiP, they said OK and gave the agent the nod proceed with my offer.

If you meet with the broker, they are happy that you can afford the property, but continue to press to use them, then you should consider complaining.

kingstreet

Many builders offer incentives to use their preferred broker.

The issue for the builder is control. Knowing their broker is handling the case gives them confidence that target dates will be reached.

If we had £1 for everyone who thought HSBC offers HTB Equity Loan or Nationwide will do 90% on a newbuild flat, we'd have a few quid.

Newbuild is a specialist sector with its own peculiarities and many who advise on mortgages know little about them.