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Employing a 'Financial Advisor' when buying a house?


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Want the hive mind's opinion on this.

My brother was telling me the other day that when I buy a house I should employ a Financial Advisor as they'll be able to do all the paperwork and get me the best mortgage deal blah blah.

I'm a bit skeptical; my brother paid IIRC hundreds of pounds to his FA when buying his place and I'd just like to know is it really necessary or can a DOSBODS skinflint do all this himself and save the money?

I do realize the difference between a FA and a solicitor which I will definitely need.

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With the advent of the Internet it's not exactly difficult to search the market for the best deal. I doubt a mortgage broker is worth the money. 

This is second hand as it wasn't me but she absolutely did do this. She is a very intelligent accountant who would have worked out exactly how much the combined costs of fees and better deal were

Mortgage broker? I believe they used to be helpful in working out what income you needed to report if you were after a liar loan  Sounds like your brother used an IFA which seems odd to me. Has h

1 minute ago, Frank Hovis said:

I don't know about an IFA.

An ex-colleague who knew what she was doing always used a mortgage broker when her fix was coming up to expiry; she paid a fee rather than his getting commission and said it was well worth it.

OK then - seems I'll need to double check what my brother actually means here.

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Mortgage broker? I believe they used to be helpful in working out what income you needed to report if you were after a liar loan :)

Sounds like your brother used an IFA which seems odd to me. Has he got evidence of a better deal than was available in the open market? The paperwork is hardly onerous. 

The important thing is never to use anyone associated with the seller or the lender or the estate agent ... find your own independent solicitor, surveyor, mortgage advice.

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I've seen a few mortgage brokers over the years to keep my wife happy, but never actually used one to get a mortgage.

My understanding is that they have access to deals that aren't available direct, so that could be beneficial. When I was last looking the ones I saw certainly seemed to have access to better short term deals than I could get direct.

 

 

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4 minutes ago, Fully Detached said:

Isn't "finding the best mortgage deals" just a euphemism for "finding someone willing to lend me that amount of money"?

No.

As @SpectrumFX said it gets you access to deals that would not otherwise be available to you.

We can all look at a thisismoney page but that won't cover everything.

In the case of my ex-colleague this was taking new fixes and she was very switched on so would not have been paying out for deals that she could have obtained by looking at the Daily Mail money pages.

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15 minutes ago, SpectrumFX said:

I've seen a few mortgage brokers over the years to keep my wife happy, but never actually used one to get a mortgage.

My understanding is that they have access to deals that aren't available direct, so that could be beneficial. When I was last looking the ones I saw certainly seemed to have access to better short term deals than I could get direct.

 

 

Trouble is most of those deals will be 2 or 3 year fixed rates and then you have to go through the same rigmarole in 2 or 3 years time. More fees and hassle. People never seem to cost in the repeat fees payable. These advisors love churn. 

Best to DYOR then ask an advisor if they can better that deal. If they can then pay their fee else walk. 

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1 minute ago, the gardener said:

Trouble is most of those deals will be 2 or 3 year fixed rates and then you have to go through the same rigmarole in 2 or 3 years time. More fees and hassle. People never seem to cost in the repeat fees payable. These advisors love churn. 

Best to DYOR then ask an advisor if they can better that deal. If they can then pay their fee else walk. 

That was my experience, and my thinking. I'm currently 2 years into a 10 year fix I arranged myself, and quite happy not to have any need to renegotiate my mortgage deal in the current circumstances.

 

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10 minutes ago, the gardener said:

Trouble is most of those deals will be 2 or 3 year fixed rates and then you have to go through the same rigmarole in 2 or 3 years time. More fees and hassle. People never seem to cost in the repeat fees payable. These advisors love churn. 

Best to DYOR then ask an advisor if they can better that deal. If they can then pay their fee else walk. 

This is second hand as it wasn't me but she absolutely did do this.

She is a very intelligent accountant who would have worked out exactly how much the combined costs of fees and better deal were against publicly available deals.

My reaction to using a mortgage broker would absolutely be as cyncial as you if I did not know somebody who used one repeatedly and saved money by so doing.

You do of course need to use the right mortage broker and to pay them a fee rather than letting them take commission which puts them in the position of wanting the best deal for them rather than you.

Most people resent paying a flat fee because they want something for nothing and lose out as a consequence.

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If your objective is to find the best mortgage deal available to you and if you know what you want (fixed/variable/offset, 2/3/5/10 years, fee, no fee, flexible overpayments,redemption charges etc etc etc) then I would find the best deal you can and then invite a mortgage broker to better it.

If you don't know for sure what you want then a mortgage broker or financial adviser can help you identify the best option for you. If your personal situation is unusual (i.e. self employed earnings, chequered earnings history or low deposit) their knowledge of lenders' preferences can be invaluable too but I doubt that applies to you Joe.

The mortgage brokers I know are extremely busy at the moment and it is apparently a tough time to get a mortgage. Lots of people are trying to move house. Lenders are getting scared, raising affordability requirements and pulling deals. It could be different in NI, no idea.

Good luck!

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Interesting responses from all.

My brother had to stretch himself to get a mortgage, and it was 30 year I think to start, and he was re-negotiating every couple years I think as his pay increased slightly....think he's down to 25 years now.

If I don't buy cash I'll have a 60% deposit easy, so I'd rather have a nice boring longer term fix, which I'm hoping wouldn't be hard to find with a larger deposit.

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I think I paid 300 quid for an advisor in 2017.

Apart from everything else I was doing involved with a move, I was working a lot of hours.  I didnt need the ball ache or traversing small print when I was knackered and other stuff to do.

He knew my requirements and wants.

Never pushed a sole supplier.

Handing your probable life savings over to the bank for a property is massive. It only hits you after. A few hundred quid goes a long way.

I am sure when my reknewal comes up in 2022 I will use again.

I was satisfied he had done his homework.

Edit. As above. My finances were different.

 

Edited by The Grey Man
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Fair comments above, but when I read the title of the thread, I was reminded of the property show I saw a bit of pre-crash, when some bint was discussing with a bird who was about to redo her bathroom.

"So, are you getting a project manager in for this, or are you going to project manage it yourself?"

I was on the phone to carpenter uncle Jim who helped my parents restore three fixer uppers as I knew he would piss himself. Hysterical.

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1 hour ago, JoeDavola said:

Want the hive mind's opinion on this.

My brother was telling me the other day that when I buy a house I should employ a Financial Advisor as they'll be able to do all the paperwork and get me the best mortgage deal blah blah.

I'm a bit skeptical; my brother paid IIRC hundreds of pounds to his FA when buying his place and I'd just like to know is it really necessary or can a DOSBODS skinflint do all this himself and save the money?

I do realize the difference between a FA and a solicitor which I will definitely need.

If you go with the Estate agents advisor youre more likely to get the property as youll be bunging the estate agent two lots of commission. And who said these guys werent crooked xD

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1 hour ago, JoeDavola said:

Want the hive mind's opinion on this.

My brother was telling me the other day that when I buy a house I should employ a Financial Advisor as they'll be able to do all the paperwork and get me the best mortgage deal blah blah.

I'm a bit skeptical; my brother paid IIRC hundreds of pounds to his FA when buying his place and I'd just like to know is it really necessary or can a DOSBODS skinflint do all this himself and save the money?

I do realize the difference between a FA and a solicitor which I will definitely need.

I've always used London and Country, I give them the details and what I want, they recommend a mortgage and away we go. You do still have to fill forms in but I've found them generally helpful. 

They work on commission from the mortgage provider but they do have mortgages available that are available through brokers only. 

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1 hour ago, JoeDavola said:

Want the hive mind's opinion on this.

My brother was telling me the other day that when I buy a house I should employ a Financial Advisor as they'll be able to do all the paperwork and get me the best mortgage deal blah blah.

I'm a bit skeptical; my brother paid IIRC hundreds of pounds to his FA when buying his place and I'd just like to know is it really necessary or can a DOSBODS skinflint do all this himself and save the money?

I do realize the difference between a FA and a solicitor which I will definitely need.

An IFA is not a mortgage advisor.

Ifas are meant to be more trained.

MA are form filling monkeys.

You only need a MA if

- you cannot read n write. I'm not joking. A good 30% of ukpop cannot understand a mortgage form.

- you are self employed /unusual financial position, so need someone who does non standard mortgages. Normally you always have to use MAs for specialist lenders.

- you haven't a pot to piss in and need someone who knows which lies to tell to which gormless banks. MMR has killed this.

Iirc you have a large (30%+) deposit. 

Doddle, go to hsbc/first direct (try opening an account first).

Go for the lowest fee, longest fix you can get. Prob 5 years. Around 2%. Look for no cost overpayments.

Sorted.

Do the sums.

Lowest mortgage is around 1.5% . There may be some catches.

Hsbc 5 year fix will be around 2%

Svr is 4% ish.

 

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