Most of us have been there before, looking to buy a new home. Can you picture the situation now? You see a photo in the estate agents window, and you nip in for a schedule. As soon as the agents know you’re looking to buy a property, they will offer to set up a meeting with their mortgage advisor.
You feel like you are being railroaded into using their services, you now believe that these mortgage advisors are the best in the business. The mortgage deals elsewhere aren’t worth the paper that they have been written on and if you go anywhere else for your mortgage then you will be filing for bankruptcy within 3 months. Does it seem familiar?
While it can be an excellent idea to take on the services of a mortgage advisor, it’s by no means compulsory. Advisors will either charge a fee in which case they should be offering you totally impartial advice or they will be on commission. This does mean they are likely to try and steer you towards certain products in the interest of earning a bonus.
A broker is an intermediary who will help you to find the best mortgage deal for your needs and circumstances. Those who subscribe to the Mortgage Code are bound to disclose information about the services they are providing, including:
Whether they are independent, or tied to a particular organisation
What commissions, if any, they will receive
What level of service and advice they can provide
You can request a list of local independent mortgage brokers from The Mortgage Code Register of Intermediaries check http://www.cml.org.uk for details. Independent Financial Advisors can also act as intermediaries some specialise in mortgages. Make sure to find out whether your broker charges a fee before you agree to use them, and how much it will cost. Normally they should only charge you once you have found a mortgage and had your application accepted.
Using a broker can make the process of finding and choosing a mortgage much easier you give them information about what you are looking for and your finances, and they can do the hard work. Because brokers have experience of the field and a good awareness of current market trends, they can often give good advice to borrowers. They also will have access to a vast range of products that you may struggle to find yourself mortgages from the smaller providers, for example, may not be prominently advertised.
Independent brokers earn money by selling you products they may suggest additional insurance policies for example. You are not required to take up these offers, and be aware that the broker is receiving commissions for selling you policies. However, if you are looking for extra insurance for example repayment protection to cover your mortgage payments it may be easiest to let the broker find you a policy at the same time as your mortgage.
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