Looking for a mortgage can be a bewildering affair. As the market grows, it gets more and more complicated and more difficult to know what choices to make.
There are plenty of people out there offering mortgage advice. But how do you know whether what you are getting is the right kind of mortgage advice? Here are some of the indications as to whether you are getting good mortgage advice.
• When looking for mortgage advice, you should look for someone with access to the whole of the mortgage market. Plenty of banks, building societies and even estate agents offer “mortgage advice”, but if the adviser only has access to a small number of products, the advice is unlikely to be independent. Lots of these companies work with only 5 or 6 or their favorite mortgage lenders.
• Make sure anyone offering mortgage advice is qualified and is regulated by the Financial Services Authority. The adviser is obliged to provide you with an Initial Disclosure Document, which will enable you to check this information. You can also visit the FSA website to check their authorization.
• Some so-called “advisers” stop at simply providing you with information without committing themselves. This may well be in order to avoid being sued for compensation. A good mortgage adviser will take you through the mortgage process from start to finish, including helping with the paperwork.
• Anyone offering mortgage advice needs to be a good communicator. The process is complicated enough without being obscured by jargon and vague generalities! He or she should be able to explain things clearly and simply. The adviser should also be easy to get hold of – you shouldn’t always be having to leave messages on an answering machine, without knowing whether the message will be returned!
• A good adviser will listen as well as talk. If the adviser hasn’t taken time to to gain an understanding of your situation – your financial position, what you require, how you see your future, etc. – there’s no way he/she will be able to introduce you to a mortgage suitable for your needs. The adviser should also establish whether there is anything that might make you less likely to obtain a standard mortgage – for instance, whether you are self-employed or freelance, or have credit problems.
• The adviser should be happy for you to ask as many questions as you like, and should be able to answer them (or most of them!). But there may be questions which it doesn’t occur to you to ask, especially if you are new to the world of mortgages. A good adviser will also try to anticipate your questions – for instance, by finding out whether you might be interested in a flexible product. You can’t ask about something if you don’t know it exists!
Mortgage advisers should always go through the costs and fees of your new mortgage with you, explaining each one. Don't forget to ask about things you are unsure of, they will be happy to clarify these before you commit.
As a customer you are entitled to the best possible mortgage advice. Don’t put up with second best. If the person to whom you go for advice doesn’t meet these standards, go somewhere else. Ask friends and family for recommendations of mortgage advisers they have used and been happy with. A mortgage transaction is too important to be left to chance.
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