Hearsay?

Q: Have you actually spoken to any mortgage company or are you going on hearsay? If a high street mortgage bank or building society will not help then go and see a mortgage broker.Take care with those that will offer you a mortgage for a fee. Their fees can be enormous and usually linked to an uncompetative mortgage rate

A: Im going to have to take issue with you there Eric. SOME fee charging brokers are as you describe, but the vast majority are not. For a broker to rely merely on a lenders procuration fee is likely to mean that the broker will not give you the time or care needed. A fee of a couple of hundred quid is very common and is quite reasonable. Lenders will sometimes offer better rates to brokers because the lender has no marketing, sales or compliance costs. Also, many apps are done on line now and it is the brokers time that is spent 'keying' the app, not the lender's. Mainstream mortgage lenders (as opposed to clearing banks who also do mortgages) obtain the majority of their business (sometimes as much as 80%) from the intermediary market and it is VERY important to them. Some mainstream lenders have no other delivery channel other than mortgage intermediaries. A typical mortgage broker will have at least one if not two PC/Internet based mortgage souring systems such as Mortgage Brain, M2000, TriGold etc., which will typically have over 4000 schemes from all the lenders including EVERY high street lender. The software will compare total costs of loans over any period you like and take into account the different interest charging methods, different val fees, arrangement - early redemption fees etc., so that a true comparison is available. Well worth ??200! Also, a broker is likely to have a good relationship with some specialist lenders. I have had some "esoteric" loans agreed in this way, which normally would not have merited completion of an application form.

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