Base Rate Decision 8th May 2008 - BoE HOLDS base rate at 5.00%

InMyDreams

MortgageMamma wrote: »

Now, your answer will interest me but people will take different views on this. Someone earning £30k + may be able to afford me, but someone earning say £16k may not. Why shouldnt they get free professional advice? Are they not the consumers MOST in need of professional advice as costly mistakes could be catastrophic for them?

But this is the case for all 'professional services'. Those that can't afford either don't get or the government pays for on some level. I also offer my 'professional services'. I have tutored maths since becoming a SAHM. I could write practically the same about my services. I do have a guilt trip about pricing myself out of the range of many families for whom I know I could make a real difference to their future prospects. But like you, I don't work for charity. (Although I often wonder if I should.)

I think what sucks is the way your professional services are so undermined by the way your profit/pay/income, call it what you will, is structured. It would be like me teaching for free, then getting a lump sum just for entering a student in for the right exam, plus a few tasty bonuses if I could maybe sell on a few suitable resources on the side to help them. (I certainly do advise on such, but would not dream of making additional profit out of it. I am not a retail outlet. Hmm... may I am missing a trick here!)

I can understand your frustration, but using the argument that it's not fair on people with low incomes just goes further to undermine your profession. By all means argue that the service ought somehow be funded for them, but this is a totally separate argument to banks offering good deals direct to the consumer and cutting you out. If a mortgage broker's service was properly and transparently valued and paid for, there would be no need for a distinction between broker and direct deals.

Edit; you know reading through my middle paragraph there, I finally understand why Ian Griffiths Halifax had such a chip about clients just wanting quotes and not advice.

Ian_Griffiths_Halifax wrote: »

(Ian)My advice would be that if they are confident with all this and can do their own research, what are they calling me for?
(Me)Because one of the reasons for using a broker has always been that they can source at least if not more favourable deals than individuals can direct. I thought I said that.
(Ian)You did, but you said you're comfortable with doing your own research, so why do you want a brokers?

Yes, I would be pretty offended if the person I was tutoring wasn't really interested in what I had to say, but was only using me to get a cheap exam entry, knowing that all his tuition fees would effectively be paid for through commissions that made no difference to him. I would find that insulting to the extreme. I can see why brokers do not like to do 'execution only'.

ixwood

I wouldn't dis 'flation so easily. Oil is used in making and transporting pretty much everything (including our food). And the worlds money supply is (still) in overdrive. And we're now competing with 12 guzillion ever-richer Asians and others for resources. And a lot of the easily accessible raw materials in the world have been exploited. And...

Flation is definitely coming back IMHO. Probably stagflation. For the over indulged west anyway.

Dan_Collins_2

So many points in this thread but I will try! LOL

Ixwood the difference in rates between broker channels and direct channels are normally not so extreme in the directs direction! Also, some people need advice, some can do it alone, the choice is the individuals.

Jedi, you may be right, I have always stuck up for the fee free model. However I dont think this climate is good for either. Lenders want direct business as in public going to branch.

I do think that the fee charger may fair better in survival terms as they make more money and can live a little longer with reduced earnings.

Its a shame as it just hits MR & Mrs Public.

owitemisermusa

mpsavuk wrote: »

Dream on. Theres nothing the Government can do about it. They can't force people to lend at cheaper rates. If they did try then investors would flee the UK economy in droves.

The truth is these Banks are using the credit crises to re-capitalise after all the losses they have taken on mortgage backed securities etc.

And, yes, there is a need because technically a lot of them are.....bankrupt!

Frankly, let them! Any serious business/conglomerate will always want to do business in the UK.

Some backbone from the government will send the right message.

For far too long the UK has been a milk cow for too many people (eg "non-doms").

Can you imagine HSBC/HBOS/ etc abandoning the UK market because the govt introduces legislation to help the masses? I don't.

My 2c (2p).

Dan_Collins_2

I agree owit we have been milked, bled or whatever!

But we mean nothing in the eyes of the banks if are not making them money!

dazzaofdagenham

i think 5% is a decent rate for the BOE to settle at.

If it goes much lower aren't we just recreating the situation of a few years ago when mortgages were ultra cheap and putting to much money in peoples pockets.

OK i was one of them..had a rate of 3.99% and when that finished i had a increase in monthly payments of £476 a month. Now i am struggling.

Keep it at 5%

Darren

gil13

I think there is a place for mortgage advisors, wait for it, clue in the name - as they give advice. Quite a few on these types of boards are savvy enough to make their own minds up, do their own calculations, but there are also many who are not or who can't be bothered to sit down and work through the figures, their budgets, the implications of interest only vs repayment, payment holidays, flexibility and the rest. There will always be a place for such professional advice, although like all things you get some good and bad 'advisors'. It may well be the case however that the models will have to change or fees more competitive in the age of the internet or banks increasingly using direct channels, it is also easy to criticise but in a climate of regulation, red-tape and ever increasing overheads people need to earn a living from it I guess. I used a mortgage advisor once when I bought my first flat, he was within the estate agent but self-employed as far as I recall. He offered me a fix with Chelsea BS that was as good as going direct, didn't have a cost to me, was an earner for him and ensured the EA looked after the purchase for me.. -;). These days I always go direct, but sometimes and for some people they have a place.