What do brokers actually do?

DebtClearer

I am currently using L&C as an online search tool for mortgages...but what do they actually do to help me along the way after this?

It seems they advertise a mortgage that I can get exactly the same rate for when going direct to the building society.

Does using a broker make things easier/safer/more likely to get accepted?

I am specifically interested in L&C as we are not wanting to pay broker fees.

SavingSteve

Easier as they do the leg work of dealing with the lender.

More likely to get accepted as they'll match you with a lender that meets your criteria / affordability. Minimises chances of 'wasted' searches on your credit file.

Do note that some lenders are direct to public only, e.g. Yorkshire Building Society (Inc Chelsea and Norwich & Peterborough) and First Direct, so brokers will be unable to process those applications for you. Some brokers will advise you if a better deal is available for a direct deal vs through them, but that'll likely be a fee charging broker rather than someone like L&C who get paid via commission.

On the other hand some lenders only deal via brokers, I.e. Scottish Widows, so you will have to go via a broker, or in rare circumstances brokers may have exclusive deals available (less likely these days).

IF the best deal for you is available via a broker (I.e. Not those who don't operate via brokers) there's very little downside to having a good broker do the work for you.

And lastly Safer, as they'll also (rightly, not just a hard sell) be able to advise on the right protection package, I.e. Life cover and income protection. You can choose to purchase the product they recommend, or with life cover you can shop around to see what is cheapest (charcol is a good site to look for that / compare prices to what the Beoley can obtain). Be careful seeking out income protection directly though, as some cheaper plans have very tough rules (I.e. Won't pay out if you can do any job, rather than your actual profession).

amnblog

I am specifically interested in L&C as we are not wanting to pay broker fees.

When out and about, shopping for something important, it is prudent not to restrict yourself to 'Poundland'.

csgohan4

amnblog wrote: »

When out and about, shopping for something important, it is prudent not to restrict yourself to 'Poundland'.

L+C are cheap for a reason, when it comes to service and complex cases, your going to struggle.


They stack up the cases high to get enough commission.

Kynthia

If you want a 'free broker' I'd still find someone local over L&C. I've had very good service from a local broker who took the commission instead of a fee.

Yes technically I was a simple case and could have applied direct, and I already found the best deal which they couldn't beat but I used them to apply for me anyway. The broker made sure the lender and product were suitable for my needs and the property I was buying. They took on the bulk of the paperwork, form filling and discussions with the lender, I could just scan and email them the majority of the paperwork and copies of bills/statements in the evenings after work instead of spending my working time calling tge lender. I'm sure things went through quicker as they were in regular discussions with the lender. They could explain things to me when I had questions and explain things to the lender if anything cropped up in my statements. Thry made my life easier when I had lots of other things going on and little time.

For many others they would help find the best deal. If someone isn't a straightforward case, such as poor credit, self-employed, low deposit, etc or buying a non-standard property such as a flat above a shop, a new - build or a non-standard contraction home, etc, then they will know the policies of the lenders on these things. This will stop you applying for a mortgage you are bound to be declined for which then doesn't look good and delays your purchase.

PixelPound

amnblog wrote: »

When out and about, shopping for something important, it is prudent not to restrict yourself to 'Poundland'.

:rotfl:

It's also coming to understand what the broker will do for you and the value you put on them doing the work as supposed to finding out yourself.

To the OP, you don't mention the size of your mortgage nor whether your's should be straight forward or not. It is easy to think of brokers in the same vein as PPI sales, but if it's straight forward and you know exactly which product then why bother with a broker?

I used L&C initially, but after getting a decline from the Halifax before I'd submitted bank details, etc, decided that a paid local broker will be best.

With L&C you get a call centre employee who will look at your details and match you to a product, and be assigned someone afterwards who is your advisor dealing with the mortgage company.
The plus of using a broker, including L&C, is their experience in knowing how to handle the mortgage companies. So you give your broker all the information, and they submit it, and provide any follow up information requested. It's like when I was asked for additional months bank statements, I was willing to give a whole year, but the broker said not to - "if you give them more information they have to look at it" i.e. it could slow the process down or turn up additional questions.

The downside of L&C is their business model is one of volume, so you are simply one of many many clients that adviser is handling at the moment. So you could get pushed down the pile whilst they wait for more info, and if your if your mortgage is relatively low so is the commission and it could well be they put more effort into closing higher value deals. Remember they have targets to do.

koexelek

DebtClearer wrote: »

I am currently using L&C as an online search tool for mortgages...but what do they actually do to help me along the way after this?

It seems they advertise a mortgage that I can get exactly the same rate for when going direct to the building society.

Does using a broker make things easier/safer/more likely to get accepted?

I am specifically interested in L&C as we are not wanting to pay broker fees.

You can service your own car, or pull your own teeth out to save money, but it is likely to be a much slower and more painful process.

dunstonh

I am specifically interested in L&C as we are not wanting to pay broker fees.

L&C are a factory line service and that is fine for some people but thy are not known to be very good on more complicated cases or where issues arrive. Once they are off the phone with you, they are on to the next person and then then next person etc. They cant dedicate the time that a local broker can give a case.

Not paying a fee can be more expensive than paying a fee. We did a mortgage case last month where the fee was £750 and the commission rebate was £1200. So, the client was £450 better off than having free advice.

MortgageMamma

Just wanted to point out that if you have a tight budget and cannot afford a fee upfront (typically £400) then you can add the fee to your loan then overpay it in chunks to reduce the extra £400 and the interest you would have paid on it. I appreciate not everyone can pay fees upfront, especially not in my area so this is an arrangement a lot of brokers will accept.

amnblog

Could me old fashioned but if an extra few hundred pounds is a problem I would suggest you are not yet ready to purchase.

csgohan4

amnblog wrote: »

Could me old fashioned but if an extra few hundred pounds is a problem I would suggest you are not yet ready to purchase.

Maybe some people are just stingy and tight with their money