Finding the Right Mortgage Broker
Finding the right mortgage broker can be a tedious job, there almost as many mortgage brokers as there are mortgage products! There are some basic rules and tips you can follow to make sure you are not walking the wrong mortgage path.
Fees
You will find a whole host of different fee structures for different brokerages and even different products offered by a brokerage. The advice here is simple keep your fees low and try not to pay on a percentage basis.
A percentage basis fee is a fee which is a percentage of the overall mortgage borrowing, so say for example you are planning on borrowing £200,000, a 1% fee will set you back £2,000. The fee is not added to the mortgage borrowing it is paid to the mortgage broker upon arrangement.
It is preferable to pay a static fee, for example £500 flat fee. The advantages are that you know how much you will be paying, regardless of your borrowing requirements. This is especially good if you have not actually chosen a property as yet.
Some brokers will charge no fee at all but we urge you to remember the adage of, “too good to be true”. If they aren’t charging you someone is paying them, as such whoever’s product pays the best will get the business.
Note: All brokers, unless commercial, will offer free consultations, this is so that both you and the mortgage broker can establish what your requirements are. Do not be confused between Free Consultations and Free Arrangements (the latter being the arrangement of the actual mortgage product)
Products Available:
A broker is only as good as the markets available to them. Imagine having a financial advisor in a world were there was only one bank account and one investment vehicle, they may be a great advisor, but there is nothing for them to advise upon.
If a mortgage company only has access to one type of mortgage or one product, it is going to be difficult to get the best deal available, unless there product just happens to be perfect, but even then, you only know that by comparison!
It is therefore imperative that you ask your broker, “can you access the whole of the market?”. By virtue of a greater product range, you are more likely to get the best deal.