Brokers shouldn't rely on sourcing systems to help FTBs - Boulger

When finding deals for first time buyers, it is as important for brokers to use their brains and experience as it is to consult a sourcing system, according to Ray Boulger.

Boulger, senior technical manager at John Charcol, told the Mortgage Business Expo in London there were a number of good options available for first time buyers and says it is part of a broker’s skill to determine which product most suits their client.

Speaking at the Expo, Boulger says: “Sourcing systems are useful but I am a great believer in using one’s brain to secure a mortgage as well as a sourcing system. It’s a skill for brokers to know which lenders it is worth talking to and with who to place the case.

“Getting the right product for that customer as opposed to the wrong one can make a big difference in terms of interest rate.”

He says initiatives such as parental assistance, trackers and shared equity mortgages are good options for first time buyers but said higher lending charges and short-term fixed rates would not help affordability.

Boulger claims there has been a major increase in parents helping their children onto the property ladder, partly because the equity in their own property has increased.

Boulger says: “I am a great advocate of offset mortgages providing the interest rate is competitive enough. Parents’ savings can be linked to the child’s mortgage as well as the borrower’s savings offset against it. This is a very tax efficient way for parents to help children while staying in control of their capital.”

He recommends five-year deals as the best option for first time buyers, particularly those taking on a high LTV. Several years ago, borrowing 95% would enable a buyer to remortgage to a 90% deal within two years, however, a recent flattening of the property market means first time buyers may now have to wait three to five years to remortgage.

If you would like to comment on this story, contact:

John Bakie
Tel: 020 7034 2682
e-mail: John.Bakie@incisivemedia.com