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  • FIRST POST
    ashleyk
    Is this normal for brokers?
    • #1
    • 21st Jan 09, 8:09 PM
    Is this normal for brokers? 21st Jan 09 at 8:09 PM
    A couple weeks back I received an offer for the renewal of our mortgage deal from the Halifax but I was curious about something, so I rang the offices of a financial advisor I know to ask his opinion. In the past he had organised our life insurance for us, so I thought he would be helpful.

    When I called he wasn't there, so I talked briefly with a colleague of his who understood we had a deal arranged but said he would keep an eye out for any better deals and let me know if he found anything. I said I was watching the site every day but he was welcome to call me if he could get any special deals. To avoid any complications though I specifically asked him not to call the Halifax because my deal was already taken care of.

    Two days ago I discovered that he had called the Halifax and cancelled my deal to get it transferred through his company which would result in him picking up close to 500 in commission just for making a phone call... Frankly I was appalled at this behaviour and thought it remarkably out of order not least because I simply don't want someone taking over my arrangements like that without my consent, especially when the mortgage situation is so volatile at the moment.

    I called the Halifax and explained the situation, so they have now cancelled his transfer and say they will revert to my prior agreement which they were happy to do because they will then save on the broker's commission charges. Am I wrong to feel that this broker was out of order? He certainly hadn't secured me any better rate than I already had and was merely stepping in so he could grab a commission knowing that all the work was already done.
Page 2
  • Ian Griffiths Halifax
    I agree with the above 100%, but I certainly don't agree with expecting free opinion/advice.
    Originally posted by feisty1
    Neither would I, but the broker knew what he had to work with from the start and should have taken that into account in his decision to take on the challenge.
    I am a Mortgage Consultant and don't like to be told what I can and can't put in a signature so long as it's legal and truthful.
  • beecher
    He would no doubt get struck off if the FSA found out about it, as it is out and out fraud
    Originally posted by koexelek
    Good - I hope he does. Must be frustrating hearing these stories when you don't operate that way. Does make it hard for people to know who to trust though - I'd rather do it all myself.
  • feisty1
    I'm always scared to death of doing anything wrong, :confused:
    Originally posted by koexelek
    If advisers are working compliantly, they shouldn't even have the "scared to death" fear............
  • spuds
    How much do brokers get if they arrange a mortgage? Is it based on the amount borrowed or does it vary from bank to bank?

    The reason I ask is that in that BBC repossession programme the other week, one of those going under was a financial advisor - he was waiting on a commmission cheque for 3,000, which I thought seemed a lot. Could have been a few deals from the same lender I guess.
  • Ian Griffiths Halifax
    How much do brokers get if they arrange a mortgage? Is it based on the amount borrowed or does it vary from bank to bank?

    The reason I ask is that in that BBC repossession programme the other week, one of those going under was a financial advisor - he was waiting on a commmission cheque for 3,000, which I thought seemed a lot. Could have been a few deals from the same lender I guess.
    Originally posted by spuds
    It varies from lender to lender, but approx 0.25 to 0.3% of the advance. So a 30,000 mortgage at 0.3% paying 90 isn't even going to pay the phone bill. That's why sometimes you need to charge.

    A 300,000 mortgage at 900 however is a different story.
    I am a Mortgage Consultant and don't like to be told what I can and can't put in a signature so long as it's legal and truthful.
  • feisty1
    open & honest.........i have written a 450k mortgage today a proc fee of 1,485.00 ..........& i deserve every penny as I have worked very hard for this business........& it was an existing client which proves to me I must be doing something right..............
  • Ian Griffiths Halifax
    open & honest.........i have written a 450k mortgage today a proc fee of 1,485.00 ..........& i deserve every penny as I have worked very hard for this business........& it was an existing client which proves to me I must be doing something right..............
    Originally posted by feisty1
    I bet you didn't charge a fee on top though like many would.
    I am a Mortgage Consultant and don't like to be told what I can and can't put in a signature so long as it's legal and truthful.
  • feisty1
    no i didn't and i never have charged this particular client any fees as he is one of my HNW clients........but then i wrote a 57k A&L on mon night, 100 miles round trip & i think proc fee 200.00 no client fee.......i have always tried hard to provide a good service and from that I rcv referrals..... i am holding my head above water during these difficult times then.. I see other advisers with 30yrs experience struggling and I ask where's yr client bank, where's yr referrals......they're unable (or won't) change, upskill, diversify, utilise all their qualifications and have never bothered to service clients properly, their IT skills probably lend to Trigold & this site....no idea how to mail merge for newsletters etc, they just sit & moan and talk of the glory days!
    • dunstonh
    • By dunstonh 21st Jan 09, 11:38 PM
    • 98,581 Posts
    • 67,058 Thanks
    dunstonh
    If advisers are working compliantly, they shouldn't even have the "scared to death" fear............
    Originally posted by feisty1
    Its always worth keeping a healthy fear of the regulator. Keeps you on your toes.

    However, if you are compliant and interact with the FSA rather than be arrogant and obtuse then you will find they are fine to get on with as well.

    That said, I know a firm that had an FSA inspection last year and the 3 sent out to inspect the firm had no FPC/Cemap qualifications, no idea of what was involved in running a firm and costs involved and really didnt undertand the difference in many of the products available. That doesnt inspire confidence.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • ashleyk
    I had a nasty shock 1 hour ago when I received a letter from the Halifax saying that the mortgage had been confirmed and fixed at that rate. Moreover, they had already debited the 1499 product fee. I find the behaviour of this broker absolutely outrageous since he had autonomously decided to fix that rate and committed me to spending the 1499.

    This is now being passed to a different department at the Halifax but since this broker cancelled my deal I will now have to go through another mortgage review and set it all up again next week. Hopefully that will all go smoothly.

    Following this I called the broker's company owner, having luckily found his mobile number and he was extremely apologetic saying he will look into it and get back to me later today, so I am waiting for his call. He understands that without my authorisation the broker never should have got involved but in any case he said that he would be holding off rather than confirming now since rates are likely to go slightly lower in February. That's exactly why I had reserved the deal but not yet confirmed it... Even the Halifax were saying that was a sensible strategy.

    Now I shall just wait a while to see what happens but I am really quite speechless at what has gone on.
    • koexelek
    • By koexelek 22nd Jan 09, 1:45 PM
    • 7,648 Posts
    • 16,202 Thanks
    koexelek
    It varies from lender to lender, but approx 0.25 to 0.3% of the advance. So a 30,000 mortgage at 0.3% paying 90 isn't even going to pay the phone bill. That's why sometimes you need to charge.

    A 300,000 mortgage at 900 however is a different story.
    Originally posted by Ian Griffiths Halifax
    But of course, the same amount of research and paperwork is needed in both instances :rolleyes:
    I am a Mortgage adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • koexelek
    • By koexelek 22nd Jan 09, 1:48 PM
    • 7,648 Posts
    • 16,202 Thanks
    koexelek
    If advisers are working compliantly, they shouldn't even have the "scared to death" fear............
    Originally posted by feisty1
    Not talking about acts of fraud, just the fear of making an innocent mistake ( like losing a photocopy of a customer's passport on a file from 2006 or something).

    I would think surgeons feel the same way during operations.
    I am a Mortgage adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • feisty1
    I do hope this is all resolved in yr favour and the advisor is dealt with appropriately. However, I have to add I would be aghast if one of my clients decided to go and arrange a new mortgage on their own and then phone me up to reassure them they had done the right thing.

    If I arranged insurance on a clients behalf it would not entitle them to free future "advice".

    Just proves, not such a thing as a free lunch.

    Pls don't interpret this as me supporting the advisor because that I am not.
    2 wrongs don't make a right.
  • ashleyk
    I didn't actually call to ask advice about the rate or the deal since I was happy enough with the way it had all been organised and needed no reassurance. I merely wanted to ask a quick question of technical clarification about the process of mortgage confirmation V simply reserving the deal.

    I certainly understand your point about not giving away free advice and yet I can also note that in my own business I frequently get contacted by clients, ex clients and perhaps prospective clients who are looking for assistance or advice and on a normal basis I do so quite freely because it creates good will.
  • feisty1
    So you arranged it on yr own but still wanted something clarified by someone who you thought would know, maybe you should have called the person you had arranged it with.

    I accept what yr saying what you so in yr business and if yr happy with that & it works for you it is fine.

    I still stand by what I first said..it is ludicrous to think of someone arranging something on their own and then picking up the fone to an adviser for information on something they will not be paid on. I am not commission driven
    but I am neither a charity or information service.
  • ashleyk
    I will remember that the next time I am in a broker's office and they ask me for some free advice which they did two years ago when I was arranging some life insurance!
    • silvercar
    • By silvercar 22nd Jan 09, 2:29 PM
    • 39,644 Posts
    • 163,805 Thanks
    silvercar
    I still stand by what I first said..it is ludicrous to think of someone arranging something on their own and then picking up the fone to an adviser for information on something they will not be paid on. I am not commission driven
    but I am neither a charity or information service.
    by feisty1
    Hypothetically speaking, what do you do?

    Say, "I'm not telling you unless you pay me."? But that sounds churlish and you want to retain goodwill for future business/ recommendations.

    Say, "Ask the person that advised you."? But you know they went direct and it still sounds like you are saying that you could answer but choose not to.


    ????????
  • feisty1
    Quite right!
  • feisty1
    Hypothetically speaking, what do you do?
    Say, "I'm not telling you unless you pay me."? But that sounds churlish and you want to retain goodwill for future business/ recommendations. Say, "Ask the person that advised you."? But you know they went direct and it still sounds like you are saying that you could answer but choose not to. ????????
    Originally posted by silvercar
    I would redirect them back to the person they dealt with and honestly explain as I was not involved in the process I wouldn't feel in a position to answer any questions, the best person to do that would be the person who arranged it.............
  • feisty1
    Hypothetically speaking, what do you do? Say, "I'm not telling you unless you pay me."? But that sounds churlish and you want to retain goodwill for future business/ recommendations. Say, "Ask the person that advised you."? But you know they went direct and it still sounds like you are saying that you could answer but choose not to.
    ????????
    Originally posted by silvercar
    Sorry I meant to add, if a client has gone off on their own and arranged something I don't think it would be a worry of "retain goodwill for future business/ recommendations", as this is a clear demonstration they no longer want yr advice (unless a questions pops up)

    Clients can choose who they deal with, but what they forget, is SO CAN I.
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