Using a Mortgage Broker or Not??

[Soontobewed]

Hi All
Just want to get some thoughts on this.

When applying for a mortgage in these current economic times is it better to use a broker or not?

I work for a estate agents and there is a mortgage broker we use a fair bit and I approached them personally for a mortgage quote for my fiancee and myself.

Reason I used the brokers is that I felt that in the current climate where banks arent exactly rushing to give out mortgages ,that the best way to get one was to approach a broker that I knew and who would already have a existing relationship with the banks .

The brokers have a added incentive to get you a mortgage .The brokers have secured MIP from 3 banks.

However my fiancees family feel that its better to ignore a broker and just approach a bank direct.

I personally dont think that walking up "cold" to a bank and asking somebody that doesnt know you a mortgage is going to be as effective as using a broker.

The bank official almost certainly wont know u and while you may have all the necess docs , I think that having the additional benefit of a "reference" from a broker will make a difference.

What are the thoughts of other people ?

many thanks
efm

 

[WaterSprite]

There's nothing to say you can't do both. Some banks don't deal with brokers at all (NIB for example, although their rates aren't too hot at the moment). I'd get a list from the broker of the banks s/he is going to approach and then go to the other ones yourself. It's a bit more work to do it yourself but it gives you a better insight into the workings of the whole thing.

It's impossible to know what, if any, influence a broker will have on the banks. Obviously, it will come down to your income and what you can repay - I don't think that a "reference" from a broker will sway things much either way. Banks don't have to know you personally to consider your application - over the years, I've gotten quotes from the three banks that I use and haven't once met someone in the bank that I'd met before.

The thing with a broker is that you have to be sure of the banks they are submitting your application to. If you trust the broker, then that won't be a problem. You will always have the gap between the banks that deal with a broker and those who don't though. I'd take a look at the interest rates and see which ones suit you the best and make sure the broker approaches those institutions and, if they don't/can't, then do it yourself. Using a broker takes a lot of the hassle out of things, but only works if the broker gets you the mortgage you want.