One of the things that fusses me about the mortgage industry is the number of unscrupulous brokers that operate in this market.
Talk about giving the industry a bad name!
I worked for a mortgage lender until quite recently and I used to be shocked at the fees that brokers charged their clients. I intend allows set this whole "mortgage arranging" thing into perspective.
Assume I am meeting a client today. The cat walks into my office and sit downs down and have a confabulate with me about getting a mortgage.
It looks that he is not a "clean" client as he is suffering from a few credit problems. Well, I shot my mentum and allow out a couple of suspirations but wait, I can aid HIM.
I state the client that it is going to be hard but I believe I can assist him. There may be a few "fees" but hey, at least he is going to get a mortgage and that is all he cares about isn't it?
So, he needs to borrow £150k. Because of ALL the work I am going to have got make I am going to charge him a competitory fee of 3% of the loan amount. That's right, £4,500!.
But, he makes have got got credit problems and he is going to get a mortgage and that is all he cares about right?
Oh, and the £4,500 doesn't have to be paid upfront because all we will make is add it onto the loan amount. So that's ok ,right?
NO,NO,NO.
Ok I am talking about a hypothetical state of affairs but this is one that is repeated mundane throughout the UK. In my sentiment it is nil more than than robbery and shows light respect for the clients wellbeing.
How can anyone warrant charging that to a client that volition already have got to pay a higher interest rate than a clean client would.
So, to recap, the £150k loan now goes £154,500 and that is before you even get to the canvasser and arrangement fees, allow alone the Mortgage Indemnity Premium (MIG.
So, the regulation of pollex here is a simple one.
Ask your broker to warrant their fees and if you happen anyone charging a fee of more than 1%, walking away. Quickly.
Furl It
Simpy
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