While most mortgage brokers need to be registered with the Financial Services Authority in order to advise clients on residential mortgages, no such rule exists for buy-to-let mortgages. This is because buy-to-let mortgages are regarded as commercial loans and the Financial Services Authority does not regulate this type of finance.Regardless of the fact that a mortgage broker does not need to be registered to advise on buy-to-let mortgages, if...more
The mortgage intermediary market is facing a potential recruitment crisis due to a lack of graduate mortgage brokers entering the industry. Unlike many other professions, such as accounting or banking, the mortgage industry does not have a structured recruitment process designed to attract new mortgage brokers.At present, the industry is awash with mortgage brokers in their 40s or 50s who are nearing retirement and who have little interest in...more
Prior to 2004 there was little regulation for mortgage brokers conducting business in the UK. Anybody could call themselves a mortgage broker, regardless of whether or not they held the necessary qualifications, and they could source clients and conduct their businesses in any way they chose to.However the Financial Services Authority introduced a strict regime of regulation on 31 October 2004. Mortgage brokers were forced to obtain industry approved qualifications and conduct their business in accordance with the FSA's rules and regulations.One rule that was introduced on that date eliminated the ability of mortgage brokers to source clients through cold calling. Cold calling involves phoning people at random without any prior consent given by the individuals. It is a technique that was used by many mortgage brokers to find new customers prior to the new rules coming into effect.This meant that mortgage brokers who relied on cold calling to expand their customer base were forced to invent new ways of finding clients. Because of this, lead generation companies began to emerge that generate leads for mortgage brokers who do not have the ability to do it themselves.The lead...more
When searching for a home loan, you will be faced with the decision of whether or not to use a mortgage broker. There are advantages and disadvantages to using a mortgage broker instead of applying for a home loan directly with a lender.One of the main advantages is that independent mortgage brokers have access to, and knowledge of, the entire UK...more
Independent mortgage brokers are generally regarded as an excellent source of advice when searching for the right mortgage to finance or remortgage a property. Independent mortgage brokers are not tied to advising clients to use particular lenders and home loan products. Instead, they have access to all mortgage lenders and products available on...more
When looking for a mortgage you may be faced with a decision as to whether you should use the services of a mortgage broker instead of applying for a home loan directly with a lender.One of the main reasons why you should use a mortgage broker is that they have access to a much wider range of products than an individual lender does. Mortgage advisors who work within bank branches are tied to the products that the bank offers and cannot advise on products offered by other financial institutions. This means that tied advisors are not able to offer advice on the entire mortgage market and are therefore not independent and unbiased.Instead those mortgage brokers are usually limited to about a dozen products, usually with varying interest rates, loan-to-value ratios, and fees. Apart from the variances in these factors, the products are mostly the same.They will usually require the applicant to pass the same set of criteria, such as credit worthiness, in order to assess whether they are eligible for a loan. This normally means that applicants with adverse credit will not be approved and the lender will not assist them in locating a more suitable product.Independent mortgage brokers, on...more
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In recent times, Independent Financial Advisors (IFAs) have been used by many people as an alternative to mortgage brokers. The main reason for this is that there is a crossover between the services they offer.IFAs and mortgage brokers usually...more
Equity release is a way for homeowners to release cash from the equity that has built up in their home. Equity can be defined as the difference between the value of a property and the balance of the mortgage, or any other finance, that is secured on...more
There are several different types of methods for interest to be charged on mortgages. Tracker mortgages have a variable interest rate that moves roughly in line with the Bank of England Base Rate (BoEBR). Another popular type of interest rate is a...more
A capped rate mortgage has an interest rate that cannot rise above a pre-determined level for a specified period of time. After the capped rate period expires, the interest rate of the mortgage reverts to the lender's Standard Variable Rate (SVR).A...more
Fixed rate mortgages offer borrowers the ability to help budget for household expenses more accurately because they have an interest rate that remains constant for an agreed portion of the overall term of the mortgage - typically between one and five...more