Most of us have been in the market for a new home before. Can you picture what's going on right now? You see a picture in the real estate agent's window, so you go in for a list of open houses. As soon as the agents find out you want to buy a house, they will offer to set up a meeting with their mortgage advisor.
You feel like you are being forced to use their services, and you now think that these mortgage advisors are the best in the business. The mortgage deals you'll find elsewhere aren't worth the paper they're written on, and if you get your mortgage anywhere else, you'll be bankrupt in 3 months. Does it seem familiar?
Getting help from a mortgage advisor can be a good idea, but it's not required. Either advisors will charge you a fee, in which case they should give you completely unbiased advice, or they will work on commission. This does mean that they might try to get you to buy certain things so they can get a bonus.
A broker is a middleman who will help you find the best mortgage deal for your needs and situation. Those who sign up for the Mortgage Code are required to share details about the services they offer, such as:
- What, if any, commissions they will get
- Whether they are on their own or belong to a certain group
- How much service and advice they can give
The Mortgage Code Register of Intermediaries has a list of independent mortgage brokers in your area. For more information, visit www.cml.org.uk. Independent Financial Advisors can also act as middlemen. Some of them focus on helping people get mortgages. Before you agree to work with a broker, find out if they charge a fee and how much it will be. Usually, they shouldn't charge you anything until you find a mortgage and your application is accepted.
Using a broker can make it much easier to find and choose a mortgage. You tell them what you're looking for and how much money you have, and they do the hard work. Brokers can often give good advice to borrowers because they have a lot of experience in the field and are up to date on market trends. They will also have access to a wide range of products that you might not be able to find on your own. For example, mortgages from smaller providers might not be advertised in a big way.
Independent brokers make money by selling you things. For example, they may suggest that you buy more insurance. You don't have to take advantage of these offers, and you should know that the broker is getting paid to sell you policies. But if you want extra insurance, like 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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