Contractor mortgages - reapply fee

[NibblyPig]

Is paying a contractor mortgage broker thing?

Cos my normal broker (before I was a contractor) didn't charge me, he took the fee from the bank that supplied the mortgage. All his fees/payments were listed and I had to sign to say I understood.

He was really good too, got the paperwork through incredibly fast, and kept me updated at every step, even sent me bits and bobs of useful information and timescales etc.

[Mark McBurney@CMME]

Is paying a contractor mortgage broker thing?

Cos my normal broker (before I was a contractor) didn't charge me, he took the fee from the bank that supplied the mortgage. All his fees/payments were listed and I had to sign to say I understood.

He was really good too, got the paperwork through incredibly fast, and kept me updated at every step, even sent me bits and bobs of useful information and timescales etc.

Hi NibblyPig,

Most brokers nowadays, particularly non-corporate (i.e. Which!, London & Country, Countrywide etc) firms, charge a fee. This can vary of course, but the overwhelming majority charge a fee.

As for contractor specialists, there is a little more work that goes into obtaining a mortgage based on day rate, and so, again, most charge.

I always say to clients however that you shouldn't let the fee decide who you use. A wise approach for many people would be to call two or three brokers for an initial discussion, and then see who makes you feel more comfortable/confident, be it the broker who doesn't charge, or the one who is the most expensive, as the overwhelming thing is that you should trust your broker, rather than just either pay a fee for the sake of it, or go with the cheapest.

Regards,

Mark

[Gordon ContractMortgages]

I don't expect them to work for free, but I think it would be unfair to charge the same fee each time you apply for a mortgage, when in all likelihood, they've just got to reinput the same information in a few forms.

Contractor mortgage brokers earn commission from the selected Lender on completion of your mortgage. Yes - Some contractor mortgage brokers typically charge a service fee whether the mortgage goes through to completion or not, but not all of us do.

[Freelancer Financials]

Hi NibblyPig,

Most brokers nowadays, particularly non-corporate (i.e. Which!, London & Country, Countrywide etc) firms, charge a fee. This can vary of course, but the overwhelming majority charge a fee.

As for contractor specialists, there is a little more work that goes into obtaining a mortgage based on day rate, and so, again, most charge.

I always say to clients however that you shouldn't let the fee decide who you use. A wise approach for many people would be to call two or three brokers for an initial discussion, and then see who makes you feel more comfortable/confident, be it the broker who doesn't charge, or the one who is the most expensive, as the overwhelming thing is that you should trust your broker, rather than just either pay a fee for the sake of it, or go with the cheapest.

Regards,

Mark

Mark is absolutely right. It's not so much about whether a broker charges you a fee or not (unless it's stupendously high). Some brokers don't charge you a fee, especially those who work out of estate agents. But be very cautious who you appoint to do your mortgage, especially if they don't have experience dealing with contractor's applications. It can be difficult to repair the damage if they incorrectly package your application. Before you go ahead, check their general reputation and whether they have any genuine experience dealing with contractors. Ask them for testimonials and reviews, this is important. Don't assume they are qualified to assist you just because they say they are CeMAP qualified. You'd be surprised how many mortgage advisers can't even interpret accounts let alone a contractor's status.

It's no different to getting quotes from builders for an extension, you ask them for references and check their previous work. Always do your due diligence.

[alphadog]

Which broker did you use?

Basically, I'm looking for a "pushy" broker, who will keep things moving forward (including lazy old me).

Ben at Power Mortgages. I can recommend him.

If you go for a lifetime tracker/variable rate mortgage with no fees for overpayments, you may never need to apply for another mortgage

[Bozwell]

There is a potential downside to the broker getting paid by the mortgage provider. Although you save on the fee how do you know if they are getting the best mortgage for you, or the mortgage that pays the highest kickback fee? The brokers that charge a fee to the customer tend to be most independent.

[Sausage Surprise]

Power Mortgages

me too

[Gordon ContractMortgages]

There is a potential downside to the broker getting paid by the mortgage provider. Although you save on the fee how do you know if they are getting the best mortgage for you, or the mortgage that pays the highest kickback fee? The brokers that charge a fee to the customer tend to be most independent.

Regulation by the Financial Conduct Authority ensures the broker is not biased to any particular mortgage provider. The broker is required to ensure that the recommended provider is the most suitable for the customer’s needs.
No other factors influence the decision.