A mortgage is likely to be the largest financial commitment most people will make. This means that it really pays to get advice from a fully qualified mortgage professional.
Usually, that person is a whole of market mortgage advisor. Just like IFAs, mortgage advisors are regulated by the Financial Services Authority (FSA). This means that they have to pass exams and hold qualifications to confirm and maintain their knowledge of the market. The advice that they give also has to conform to strict rules set down by the FSA. The below video by Unbiased explains why Mortgage Advisors are important.
There are 2 key types of mortgage advisor: an independent mortgage advisor and a tied mortgage advisor.
An independent mortgage advisor can offer products a large array of mortgage providers. They don’t tend to have access to all of the mortgages available on the market though. High street banks, for example, don’t tend to allow independent brokers to offer their entire range.
A tied mortgage advisor tends to be someone that you’d deal with through a single bank or building society and they mostly only offer products from the mortgage lender they’re tied to. So if you arrange to speak with a mortgage advisor via your bank you’re likely to be dealing with a tied mortgage advisor rather than an independent mortgage advisor.
It’s crucial to understand which type of advisor is helping you, so that you’re comfortable with the number and type of options you’re shown.
When you talk to an independent advisor for the first time, you may have found a house to buy and be in a rush – getting the mortgage sorted can be the key step for most people. A mortgage adviser should ask you lots questions about a wide range of subjects, to find out everything they can about your circumstances and the house you want to buy. This allows the advisor to understand what you can afford to pay. This is known as a Fact Find, and it helps the adviser to identify other areas in which you may need advice – like building and contents insurance or life insurance.
This process allows the adviser to recommend products that are affordable. You’ll be asked to confirm that you understand the commitment you’re taking on. It’s a good opportunity to explore the benefits of these products, as independent mortgage advisors may have access to deals that are not available through comparison websites or on the high street.
When you’ve chosen your mortgage, the mortgage advisor will make an application to the mortgage lender on your behalf. If you’re accepted, the advisor will then liaise with all the solicitors, estate agents, and lenders for you – right up until you finally complete your purchase. Their experience can be invaluable in getting your house purchase through.
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