Reply to: Can you / should you trust mortgage brokers?

[Old Greg]

Exactly. If the mortgage is an offset, it makes no difference overall. Better to keep the money in your bank for easy access.

Well, it makes a slight difference if the rate is greater due to the lower deposit. But may be worth it for the flexibility.

[MarillionFan]

5% with an offset could well be worth it.

Exactly. If the mortgage is an offset, it makes no difference overall. Better to keep the money in your bank for easy access.

[Old Greg]

OK, it would depend on so many variables. A 5% deposit on a mortgage with a fixed rate of 1% for 10 years that allowed overpayments (or was an offset) - most people would jump at that.
Without providing more information it would be very difficult for us to give you any meaningful help.


Also, if you don't tell the broker how much of a deposit you would like to put down, how are they supposed to guess?

5% with an offset could well be worth it.

[SueEllen]

If you aren't married be wary of splitting the mortgage.

[Emma Power Mortgages]

Thanks all, that's quite a few replies in short time

Ok, I understand this may have sounded vague, but I don't have any family here in the UK and most of my friends are still renting. I just want to understand whether I can trust brokers' advice...

I told the broker i am looking to buy with 10%, he straight away told me back that I should buy with 5% as the 'rate is almost the same' (i.e. 0.03% or so) and this will leave me with more money for other things like furniture.

This totally confused me as i was under impression that the bigger deposit the better rates etc.

I currently rent and pay £850 split between the 2 of us (plus bills). Mortgage repayments would be similar amount.

I'm not sure its best advice to persuade someone to reduce their deposit size....... but without knowing what you discussed, exactly, its hard to comment on their advice. The added risk and extra interest is something that should always be discussed and covered off. If you have alarm bells about someone perhaps try another broker. The majority of the specialist brokers do know what they are talking about, find someone you trust that has a solution you are comfortable with. If you aren't happy with something they have said don't be afraid to ask questions as to why they have recommended something.

[Forgotmylogin]

Who cares?

The short answer is - rates for 5% vs 10% deposit are almost the same as a 10% deposit is considered to be bugger all. You don't get a real change in rates until you have a properly sized deposit.

[northernladuk]

Not sure if offset mortgage... contracting almost a year. Working in this area of business about 3 years. Property value 180k

Not sure if it's an offset or not?? Do you not think that is pretty key?

[squirrel99]

This is why i suggest you find out if the broker will be getting a bonus or on going commission as a result of your decision. that 5% will cost 3 times more over the term so its quite a good earner for the mortgage company.

My gut feel is to never trust anyone in an estate agents when it comes to taking additional services like mortgages surveyors or solicitors all of the big players have large margins on those services.

Thank you so much for your advice, I will do that.

[bobspud]

I told the broker i am looking to buy with 10%, he straight away told me back that I should buy with 5% as the 'rate is almost the same' (i.e. 0.03% or so) and this will leave me with more money for other things like furniture.

This is why i suggest you find out if the broker will be getting a bonus or on going commission as a result of your decision. that 5% will cost 3 times more over the term so its quite a good earner for the mortgage company.

My gut feel is to never trust anyone in an estate agents when it comes to taking additional services like mortgages surveyors or solicitors all of the big players have large margins on those services.

[squirrel99]

OK, is that an offset mortgage? Have you been in business long? What is the approx. value of the property?

Not sure if offset mortgage... contracting almost a year. Working in this area of business about 3 years. Property value 180k

[eek]

Oh, okay. Thank you for clarifying - I actually carefully considered which section to use I thought i will be told off for using Business section for not exactly business related topic.. oh well

As I said, general is badly and inappropriately named for newcomers

[squirrel99]

NLUK was more pointing out that you probably should have asked this question in the Business section rather than General....

General is really a very badly named forum. I've argued for years that it should be renamed and another other topics forum included within the professional forums...

Oh, okay. Thank you for clarifying - I actually carefully considered which section to use I thought i will be told off for using Business section for not exactly business related topic.. oh well

[WTFH]

Oh please god no. Don't go there.

It's Friday afternoon, what else is there to do?

[northernladuk]

OK, is that an offset mortgage? Have you been in business long? What is the approx. value of the property?

Oh please god no. Don't go there.

[WTFH]

Thank you I think he mentioned rates like 3.80% (10% down payment) and 3.83% (5% down payment).

OK, is that an offset mortgage? Have you been in business long? What is the approx. value of the property?