Mortgage Advisor Fees

cantthinkofone2008

Have used a mortgage advisor who informed me the fee would be £245 they never told me when it was due and I signed no paper work, anyway they found a mortgage and then I asked them to make an application. They then sent through the paperwork for the application i.e to get signed etc and request for payment. Haven't done anything yet as have other options with banks directly and not decided. However the advisor is now saying that I owe them money as I have made an application, but as far as I can see as I didn't send the forms back signed, I haven't made an application and don't owe them anything???? What do you think???

minimike2

What does it say on your Initial Disclosure Document in the fees section?

cantthinkofone2008

Is this the facts about your mortgage sheet? It says their fee is due on application.

The sheet that I haven't signed is a declaration sheet for their company.

JoJoArmani

Did they tell you which mortgage product it was they were recommending?

cantthinkofone2008

Yeh got all the details of it. The sheet I haven't signed is a 'Declaration and Authority' for the broker's company to have the authority to do a list of things.

minimike2

Its the "Key Facts About Our Services" that should have been given to you at the outset.

If the fee is stated as payable at application then you will need to pay it as you have aksed them to make the application. It doesnt matter if you dont accept the mortgage offer, the fact that you asked them to make the application for you means the fee becomes payable. (I assume from what you have said you asked for a full application not just a decision in principle??)

cantthinkofone2008

Cheers

I understand that it is to be paid at application, but the way I see it they were waiting for me to send payment and send back the Declaration and Authority sheet signed to apply for it? Is this how it works, or can they apply without me needing to sign anything and if so what is the Declaration and Authority sheet for exactly. I will obviously pay if I've made an application, just don't think they have yet?? Clear as mud..

dunstonh

It doesnt need to be signed. It often recommended to advisers to get a fee agreement signed but it isnt a requirement.

cantthinkofone2008

Surely if I haven't signed it then there is no 'agreement' in place? Seems unusual..I'm just trying to find out if they have applied for it or not, as if they have I will pay them and if they haven't yet I won't??? Thanks

minimike2

You do not have to sign anything to apply as the legal side of things doesnt come into effect until you sign the mortgage deed, so many lenders these days do not require you to sign the application forms. Its very different to apply for a mortgage and accept the mortgage offer. You say in your original post that you asked the adviser to make an application....I can assure you that they will have followed your instructions and done it....if I get a client who wants to do an applicaiton, i do it there and then, as I am sure most brokers are at the moment through fear of losing the rate.

Which lender is it?

cantthinkofone2008

Thanks Mike...

They were looking for me to provide info such as payslips, bank statements, passport etc. So do they not need that to apply, I haven't given any of that yet. The way I see it is I asked them to apply, they sent out request for info, and a form for me to complete, I haven't done that yet as the sale is still being tied up, and now they are worried I'm not going to go ahead, so they are now saying they have applied (to get their fee) when in fact they haven't (so they can't get their fee)????