39% of mortgage holders have never used a broker

Essex Home Finance
Over a third of mortgage holders (39%) have never used a broker, according to research from Boon Brokers.
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Over a third of mortgage holders (39%) have never used a broker, according to research from Boon Brokers.

Its research found that the number who had never used a broker rose to half (49%) of over 55s. Younger homeowners are more likely to consult an expert, with three out of four (74%) 25 to 34 year olds saying they have used a broker for a home loan.

The survey found there was a general lack of understanding around what mortgage brokers can or should offer. One in seven of those who have used a mortgage broker don’t know if they had whole of market access.

Gerard Boon, founder and partner at Boon Brokers, said: “There is still a lot of confusion around mortgage brokers and what they can do. A good broker with whole of market access can find the very best mortgage product out there for a client, saving them a small fortune. One common misconception, however, is that homeowners have to pay broker fees when applying for a home loan or remortgage. Consumers shouldn’t assume that broker fees are the norm, as all mortgage brokers in the UK are paid a procuration fee by the lender upon completion of a mortgage application. Paying a broker fee does not guarantee a better service – there is no correlation between quality of service and broker fee charged. The only purpose of the broker fee is to increase the firm’s profit margin.

“I think it’s vital the industry is more transparent about what it is offering and what costs there might be for a homeowner – there should be nothing to hide, which is why we created what we believe to be the most comprehensive guide to mortgage broker fees available online. The fact some brokers charge a fee even when a mortgage doesn’t complete is totally unethical. People need to feel confident they know enough to question fees and charges they might encounter. Now more than ever, it is vital that homeowners understand all suitable mortgage options before agreeing to a mortgage product. The difference in interest rate and other costs, from lender to lender, can be substantial, even with mainstream lenders. I would certainly suggest that homeowners acquire expert mortgage advice before agreeing to any mortgage product in this market.”

Original Article from Financial Reporter 03/11/2020

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Essex Home Finance Ltd is an Appointed Representative of Mortgage Intelligence Ltd which is authorised and regulated by the Financial Conduct Authority under number 305330 in respect of mortgage, insurance and consumer credit mediation activities only.

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