Renewing mortgage solo vs through an IFA

JustAnotherSaver

When we bought our house we went through an IFA who handled everything for us. We'd never bought a house before and didn't have a clue what to do. We didn't want to do anything wrong & end up somewhere along the line paying more through lack of knowledge so we were happy with the IFA's charge at the time & it was a case of job done.


FFWD through time & our fixed rate term is coming to an end, therefore it's the first time we've ever had to deal with renewing.



We went back to the same IFA who searched all the available deals they had on their system. I think there was over 3000 IIRC but then when they started whittling it down using various criteria (for example - we wanted to stay fixed) it turned out to be cheaper to stay with our existing lender & just switch to their latest fixed term deal.


We could've walked away at this point but they said that they can handle the whole switch & all we have to really do is give permission. For this they as you'd expect charged a fee which was reduced because we're an existing customer who's just renewing.





What i'm wondering really is what would've been the process had we walked away at the point i said & done things ourselves?
Would it be as simple as just going in to said bank, telling them you'd like to switch to their latest deal, a few clicks later job done, no charge? As simple as just upgrading/regrading your current account? Or is there more to it than that?


Right now we have to still provide proof of income, proof of address, identity proof.



I just wonder if we'd have done it all ourselves would it have just been super simple, no paperwork required, a few clicks & job done forget about it or what?

dunstonh

What i'm wondering really is what would've been the process had we walked away at the point i said & done things ourselves?

If you have not entered into a new contract with the adviser then you are free to walk away without cost. It is just a case of your morals from that point. Although you would have to through some work with the lender yourself in terms of affordability and the process etc.

sammyjammy

If you were to retain the same amount of lending and the same term you can usually select a retention deal either online or on the phone, takes five minutes.

JustAnotherSaver

sammyjammy wrote: »

If you were to retain the same amount of lending and the same term you can usually select a retention deal either online or on the phone, takes five minutes.

So once we came to the conclusion that staying with the existing lender would be the cheapest for us (for a) going fixed term and b) the length we were looking at) then we could just go direct to that lender & say - hi we're in the last 3 months of our existing deal, can you put us on this fixed term deal for the next x-years ... and that's basically it, we wouldn't need to go through providing paperwork so on & so forth, they'd just 'switch' us over to this new deal?


I say 3 months as they said we can move penalty free if within the last 3 months of the existing deal ending.






what we're bothered about is doing something wrong & it costing us. That's why we went IFA again.
The IFA did bring up other deals from other lenders but said that others (he went through them) had fees in and some required you to get a solicitor. He was able to tweak his computer system to show a fair comparison between the lenders once you factor in their fees if they have any, any cashback offerings etc and it gave you a breakdown of cheapest to most expensive with everything factored in.


If we did it ourselves then we might see something as being cheaper but miss some important terminology that once factored in would make it dearer than our existing.





The fees charged when looking at investing our pension made me bite the bullet & try going solo.

To go through the IFA for this mortgage deal was £200. If we can save that next time round without shooting ourselves in the foot then i'd like to.


For those who've seen my comments on my ability on these things (mortgages, pensions, investing in general etc) yes i'm quite the pessimist

ACG

The process for switching products varies from lender to lender.
It could be as simple as logging in and switching a new product or it could involve having to book an appointment with their advisor and go through an hour interview on the phone.

getmore4less

this was last months query
https://forums.moneysavingexpert.com/discussion/5871564/pay-penalty-to-renew-mortgage-or-leave-it


lender Nationwide.

AIUI they are an easy product switch.

amnblog

Interesting one.

We would do this switch for new or existing Clients with no fee, but we are geared up to do so.

It appears, is this case however that the Broker has spent a lot of time exploring the rest of the market before the conclusion that staying with Nationwide is the best option was reached. If the fee for that work was £200, this should have been explained at outset.

Only our original poster knows what was discussed and whether they knew the score at or are just looking for justification to save £200.

kingstreet

We do the same.

A Nationwide PT the other day earned us £74.19.

amnblog

Did you top up the tea bags from the profit KS?

ACG

I tend to take a view on this sort of thing. If the Mortgage is around £150k plus, then I would not charge.
If it is below, then I would charge some small admin fee, somewhere in the region of £100-150 depending on the size of the Mortgage.

I still have to get a sourcing list, do the research and so on to make sure it is the best deal. So there are a couple of hours work.

JustAnotherSaver

To answer a few questions...


I don't know what time the financial adviser spent exploring before we arrived. I'm of the impression zero as 15-30 minutes were taken going through our details (earnings, debts - cards etc, how much is left to pay on the mortgage, what if anything we'd prefer (variable, fixed etc).


After this was done they simply punched the details in to their computer system, pressed a few buttons & did a click-click and the system then spat out over 3000 results. We established we'd be looking at a long term fixed deal so the advisor did some more clicking and filtered out all the variable deals and short term fixed deals & the system spat out a refined results list which basically said stay with our current lender.



At this point the advisor said we could let them handle everything, it'll be treated as a new application even though it's a switch to a different deal (we'd need to provide income details, proof of address, proof of ID) and for this they charge a £200 fee, or we could just go ahead & do it ourselves.


As said, we've never done it before, we didn't want to balls things up by making errors so we just said we'd go through the advisor.





I've been in touch with Nationwide since to ask what the setup would be & they simply said that they would charge no fee at all for this. I could do it over the phone or go in branch to speak with their mortgage team or if i knew exactly what deal i wanted already then i could just do it online.
No fee
No ID, no proof of income required, no proof of address (or at least no mention of these 3 things).


Oh and there's a tad under £100k left on the mortgage if that matters, although we weren't told that this was a factor, just that they charge the fee for dealing with it. Full price is getting on £400, this is for new customers/new deals.


What's a Nationwide PT? Only PT i know is a physical trainer.