Are you thinking of approaching a mortgage intermediary?
August 6, 2008
One industry official has recently stated that whilst more and more people may be thinking of approaching a mortgage intermediary for help with finding a suitable mortgage, many may find that the number of deals that these brokers have are not far more restricted than they have been in the past, which could in effect result in less choice and more expense.
The industry professional stated: “With continuing uncertainty in the mortgage market and the total number of products continuing to decline, many more people will be considering approaching an intermediary to find them the best mortgage deal for their circumstances. However, many intermediaries are finding that their choice of products to recommend to clients has been increasingly restricted as more lenders move to offer their most competitive products just for direct only business.”
He continued: “Just 49% of deals on the market today are exclusive to intermediaries, whilst 23% are available through both intermediaries and direct business. Although intermediaries have 72% of the market to advise on, it’s the deals that are available direct from lenders which are the most competitive. The top 13 deals for a two-year fixed rate mortgage are only available direct, and of the top 20 deals only three are available via intermediaries.”
He also went on to state: “This reduction in competitive deals has led Jonathan Fischel, head of mortgages and credit unions department at the Financial Services Authority to advise intermediaries to advise on direct only products, and charge a fee for the advice given.
“However at the moment, the majority of lenders are now receiving more business than they can actually process. If the products that are currently only available direct were also made available to intermediaries, then the lenders would no doubt find other ways to restrict their business volumes, such as further tightening their lending criteria.”
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