Whether you are a first time buyer, moving home or remortgaging you will most likely need to arrange a mortgage. You could spend numerous hours visiting many banks / building societies or alternatively you could get a mortgage broker to do the hard work for you.
Not all mortgage brokers charge a fee for their service. Mortgage brokers who don’t charge a fee will get paid a commission by the mortgage lender.
What are the advantages of using a mortgage broker?
So you are about to buy your first home or perhaps it’s time to remortgage. You may be asking yourself “How do I find the best mortgage rates?” or even “How do I compare which lenders will charge a fee?” The answers to these questions are simple. First of all, talk to a mortgage broker! A mortgage broker will compare the whole mortgage market to find out who is offering you the best rates and deals. As a mortgage broker in Portsmouth, we compare 14,000 different mortgages available across all the different banks, building societies and mortgage lenders.
You are likely to save a considerable amount of money each month on your mortgage by getting your best mortgage rate and deal. Saving money is a no brainer so it makes sense and is highly worth getting a Mortgage Broker to shop around for you.
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So do some brokers charge a fee?
Yes, the majority of Mortgage Brokers do charge a fee for their service. Although these brokers will also get paid a commission from the lenders they will also charge you an additional mortgage broker fee. This fee will vary from mortgage broker to mortgage broker however will normally be anywhere between £500 and £2,000.
How do I find a broker that does not charge a fee?
Like most things in life, often the best way is to get a recommendation. This could be as simple as asking your family, friends or perhaps asking your friends on facebook. Another great option is as simple as typing into Google “no fee mortgage brokers near me”. It is definitely worth spending time to get a no fee mortgage broker as over the term of the mortgage it will save you thousands of pounds of unnecessary mortgage broker fees. We highly recommend looking at all mortgage broker’s reviews to see what others have experienced when using their services.
What are the other advantages of using a mortgage broker?
Not only will a mortgage broker search the market to get you the best deal, but they will also do a lot more for you. They will carry out all the paperwork on your behalf and submit the mortgage application for you. Once the mortgage has been submitted they will see it through to completion whilst updating and supporting you along the way. This will save you a lot of time and hassle giving you peace of mind.
If you are moving home the mortgage broker will liaise with your solicitor, estate agent and lender. This will take a lot of the stress out of moving home.
Can I expect to pay other fees?
So we have established that not all mortgage brokers charge a fee. The next question you may ask is ”what other fees can I expect to pay?”. There are three main costs you may have to pay either on a property purchase mortgage or a remortgage. These include a valuation fee, solicitors fee, and a lender arrangement fee.
The valuation fee is paid directly to the mortgage lender. The lender will get an independent surveyor to carry out a valuation survey on the property you are buying or remortgaging. This is to make sure you are not paying too much money for the property and also that it is a property the lender is happy to provide a mortgage on. Lenders are very keen to lend money at the moment and therefore the no fee independent mortgage broker you choose should be able to source a mortgage that is offering a free valuation as an incentive.
The next fee is applicable to remortgages only. This will be for solicitors also known as conveyancers to carry out the conveyancing on the remortgaging from lender to another. The solicitor will find out (to the penny!), how much is outstanding with your existing lender and will correspond with your mortgage broker.
On receipt of a mortgage offer, your solicitor will be able to raise the new mortgage and arrange to pay off your old lender in full. If you are just finishing a fixed mortgage rate, then your solicitor will make sure that they ‘complete’ after the date the fixed rate finishes. It is important this is done correctly to avoid paying any early redemption fees. Once again you will find that a lot of lenders will offer remortgage conveyancing free of charge as an incentive to get you as a new customer of theirs.
Mortgage Lender Arrangement Fee
The last fee that you may need to pay for is a mortgage arrangement fee. The mortgage arrangement fee is paid to the lender and this usually gets you a better rate with the lender. A mortgage broker will easily be able to advise you if it is beneficial to pay an arrangement fee to the lender in order to obtain a lower rate. Most lenders will give you an option to add this fee to your mortgage; this would mean that you will not have to find or pay this fee upfront. It is important that you understand that although this will help you with cash flow on obtaining the mortgage; that adding an arrangement fee to the term of the mortgage could be very costly.
A mortgage broker will be able to advise you if this is beneficial to you. The broker will also be able to get you comparative quotes from different lenders; some with lower rate arrangement fees and others with a higher interest rate with no arrangement fees.
The initial question we asked was “Do all mortgage Lenders charge a fee?” You now know that the answer is No they don’t! We also covered a host of other fees that you could be charged that is good to be aware of. We also concluded that you more than likely do not need to pay these. The above points are all great reasons as to why you should use a local independent no fee mortgage broker.
So our advice at YesCanDo is either give us a call as we are an independent NO FEE mortgage broker with offices around Portsmouth and Southsea in Hampshire. We will be able to guide you through your different possible options and support you through the whole mortgage process. Alternatively, shop around for the most highly rated mortgage broker near you.