Consumers pay £200 a month more for advised mortgage

RBS major culprit

The most frustrating part of this is that one of the worst culprits for this is RBS/ Nat West. As a tax payer I find it abhorrent that my money is being used to finance this entity whilst at the same time they are restricting my ability to earn a living

Posted by: Simon

Direct Deals

The FSA if they are to promote and support consumer choice should insist on Direct Deal KFIs being made available to clients agents. This is NOT happening routinely at the moment which means that clients are NOT able to obtain unbiased advice evern from fee only advisers. If the FSA does not sort this out soon, then the only resort WILL be for clients to take their agent along with them to any mortgage sales meeting with a lender OR for a general power of attorney to be drawn up so the lender has to decide whetehr to ignore or accept the LEGAL appointee of a client. I don't have a problem with business decisions of the lenders, but I DO and teh FSA should have when the assymatry of information available for a client in order to make a decision whether to take a package (often NON advised with little protection if a lender only is involved)to buy the most expensive item they'll ever buy in their life. The FSA failing to see the reality of how this IS to the detriment of consumers beggars belief so at least if they get replaced by a "consumer protection agency" one would be able to have them under the trade description act if they then fail to protect consumers.. I will not hold my breath though for this to be resolvesd so expect to be visting lenders with clients soon or resorting to powers of attorney instead of agency authorities!

Posted by: Phil Castle

Advice

But when the client miss-buys from a lender direct, there is no comeback and let alone the thousands that client would loose by choosing a product from their own research. I am sure most brokers have numerous stories of thousands we have saved clients after they thought the lender direct deal was best, but we can get them a cheaper and/or better deal. Just more bol*&%$s coming out of the journalists, as I still have access to 90% deals, admittedly higher than direct, but still have access to them. Just more from the soon to be defunct FSA, trying to put Brokers out of business by not banning Dual-Pricing. You can be that should all mortgages be priced the same, but we wanted to charge a margin for the advice (as they do in the US) that that would be banned quicker than you can say "Bring back the MCCB"

Posted by: Peter Scammell

IFA Partner Principal

I'm tired of this drivel from HBSI, all to drup up business for their sourcing system. We have indeed pointed clients towards 'direct' deals, but will not venture near advice on them, purely and simply because we are not going to risk our PI Insurance. Has he considered this? Our clients get a full explanation of this, and have all understood our rasoning. They also add comments of varying colour regarding "why does the FSA allow this?" Once, and it will happen, the market returns to equitable margin operation by the lending community (they can't hear at the moment because their ears are covered due to their heads being so far in the trough), we shall of course then remind those that we have listed as to why they are no longer receiving business from us. Hopefully the larger networks and clubs will take the same line.

Posted by: Derek Frost

Mortgage Broker

Let's face it, the banks are using this ruse so they can tell the tax payer that they are lending close to their capacity, the fact they have blocked out of their calculation upto 70% of the historical lending is a joke. Ripping of customers again. I have witnessed banks offering mortgages that have failed credit score when I have put them forward. Bank continue to look after themselves! But when funds become more liquid and they need brokers again will we have the voice to vote with our advice?

Posted by: Tim

Mortgage Intermediary

I find the articles objective narrow and scaremongering in a harsh climate. There is no mention of the fact that advisers are faced with dual pricing or the fact that the clients personal circustances will dictate where their mortgage can be placed and in todays market this is often not at the cheapest rate due to not meeting lenders criteria. I also find the authors comments condescending when he discusses advising intermedieries to use our skills elsewhere. He seems to overlook the fact that these skills are being used currently to battle through the ever deepening criteria that the lenders are imposing.

Posted by: Steve Rodgers

RBS...

RBS are without doubt the most frustrating of all the lenders at present. Their BDM's bang on about "oh yes we know direct products are cheaper at times, but they do even out over the course of the year through intermediary exclusives, blah blah blah..." What exclusives, Homebuyer Direct? Complete joke when you look at the rates continually on offer from NatWest Mortgage Services and RBS. Look at MoneyFacts best buys, it's their in black and white, month on month. Don't treat us like idiots. Be honest!

Posted by: Billy

Advise

Although not happy I can understand lenders commercial decision to price direct deals lower that intermediaries, but what I fail to understand is why when I recommend a client to take out a direct mortgage with a lender and the client gives written consent for my firm to act on there behalf to help the mortgage application go through as smoothly as possible, the lenders in some cases ignores the wishes of the client, how can this be Treating Customers Fairly??? We are trying to offer our clients whole of market advice but the lenders according to the FSA can hide behind 'a commercial descision' and basically do what they wish. What other business can ignore written consents from its customers??

Posted by: Michael Cooke

Mr

Firstly, I would like to say that an article like this serves only to cause further confusion. To state that the saving is £200 per month without quailification is irresponsible. Every customers circumstances are unique to them and any saving will depend on the size of the mortgage and its term. Furthermore, fees and charges will impact on the true cost of the mortgage. Secondly, it is incorrect that 90% mortgages are not available to intermediaries. Certainly the products that are available are poor and in short supply but nonetheless they exist. With regard to the rights and wrongs of dual pricing by lenders I personally feel that it is indefensible. Lenders have courted the intermediary market shamelessly through the good times and now times are tough they are turning their backs on the very people that they have previously relied upon. People deserve the right to advice and they will not get this by going direct to lenders. There is currently a petition on the Number 10 web site calling for the Government to intervene and to put a stop to dual pricing and I would urge all your readers to sign this.

Posted by: Clive Norman

HSBI Rubbish

Why is anyone giving space to this garbage. I have just been offered on a 90% deal for a first time buyer with a 5% vendors deposit, which HSBI (whoever they are) say isn't available. In this case they had been told by the branch that they did not qualify for a 90% LTV loan as they needed an 'A' pass on there credit score. As we all know first time buyers with 'A' scores are rarer than rocking horse manure. Where as the higher LTV market has been plagued by direct deals, mainly trying to take advantage of the customer by getting them into a short term fix rates just before rates drop or a tracker rate just before they rise, I've rarely seen anywhere near a £200 month advantage for a client to go direct. I give my clients a choice if they want me to include direct deals where by they will have to sort the mortgage themselves and fight off the lenders insurance salesman with his PPI advances or if they wanted their adviser to actually guide them through the mortgage from start to finish. So far one went direct and come back to me 3 days later when he was told his 'B' credit score was inadequate.

Posted by: Mark Green

Mortgage Intermediary

I agree with Mark Greens comments that there are 90% deals to be had and that fact alone renders the article invalid, does no one check the validity of the information before putting out in the public domain. Also the £200 gap is a fictional inflammatory cost being used to sensationalise the poorly researched and incorrect information in this article. If anyone publishes information like this then full data should be published showing specific loan size, term and comparable rates, was the author of this article qualified to actually understand what he or she was writing about in the first place? I suspect not. The link below is for all to join in a petition at number 10 Downing Street and vote against dual pricing. http://petitions.number10.gov.uk/Mtg-Dual-Pricing/

Posted by: Rudy Smith

IFA

What a load of bologni from HSBI as no one stays with the same provider for the duration of their mortgage and any one can pick figures out of the air (great story again). I completely agree that direct deals are cheaper but why won't the banks building society's allow us to sell them. Yes we can source the best direct deals and charge a fee but our job is to go that one step further. We complete the application for them, send in the paperwork and then chase the lender until the mortgage offer is complete and then correspond with the solicitor until completion. This is what we are paid for. WHY ARE THE PROVIDER CUTTING US OUT ALL TOGETHER AND MAKING THE BORROWER GO DIRECTLY TO THEM. WHERE IS THE FSA AND TCF IN ALL OF THIS.

Posted by: Rod collins

HBSI nonsense

This garbage about dual pricing by HBSI, estimating the savings that are available by going direct, do not take into account that most mortgage applicants do not have the facility to track down the best deals. In any case, many people do not have the 'nounce' to actually work out which (from many) is the best deal given the range of arrangement fees, rates dependent on LTVs, additional benefits (free legals or not, free valuations or not)etc And has HBSI taken into account that most mortgage lenders are still happy to sell worthless MPPI, over-priced life assurance, seriously flawed critical illness policies, over-priced home insurance etc, etc. All these problems and yet the FSA and this stinking, incompetent government is happy to flaunt anti-competition legislation to allow RBS to flog its wares backed by tax-payer £billions. Next year Gordon Brown and his dreadful, inept and fraudulent gang will be gone. I don't care if RBS goes to the wall but it won't - too many Scottish jobs on the line. The FSA may get renamed but nothing will change - indeed, it could get worse. It's all very depressing.

Posted by: Bill Wells

Mrs

Your article is inaccurate, there are at least 2 providers offering 90% LTV mortgages through intermediaries.

Posted by: Julie Howarth