Nine out of ten best-buy trackers on the market are available directly from lenders only, comparison website moneysupermarket has said.
A second report, from HSBC, found that of the 96 cheapest mortgage deals available over the past two years, there were only six occasions when brokers could beat the equivalent best deal.
HSBC said the biggest difference between broker offers and direct deals was in two-year trackers.
Martijn van der Jeijden, head of mortgages at HSBC, said: “Customers can no longer rely on brokers to get them the best deal.”
Kevin Mountford, head of banking at moneysupermarket, gave consumers similar advice.
He said the market had been turned upside down – and warned consumers to beware of using brokers.
In remarks bound to depress and infuriate brokers, he said: “Traditionally, mortgage brokers have had the pick of the best deals on the market, with lenders often offering them better deals than they were able to give to their customers direct.
“However, the financial turmoil in the last couple of years has seen the mortgage market turned on its head, and due to the lack of supply and high demand, lenders can take full advantage of the current situation rather than having to push their products through brokers, which they previously relied on.
“As a result, anyone using a mortgage broker needs to be aware that the range of products available may be limited.
“Our analysis of the currently best two and three year trackers on the market shows nine out of ten products are available direct from lenders only, highlighting that the days of brokers offering a ‘whole of market’ range of products to their customers are behind us.
“Consumers are growing increasingly savvy when it comes to their finances and have begun to understand how important it is to shop around for the best products.
“Whilst some people will always want advice from an intermediary, this should be seen as part of the shopping around process rather than the final word in mortgage products, as consumers who fail to shop around will no doubt miss out on the best deals available.”
But Andrew Montlake, director of broker firm Coreco, said: “If securing a mortgage was as simple as finding the cheapest deal, the lowest rates would take the lion’s share of all mortgage business.
“Applicants approach us with increasingly sophisticated requests.”
At the peak of the property boom in 2007, brokers were responsible for seven in ten mortgage deals.
Mortgage brokers lose out to direct deals in 90% of cases
Popular news
-
Buy-to-let will become loss-making when rates rise
Landlords with standard buy-to-let properties will lose money when interest rates...
-
Buy-to-let mortgage rates driven lower
NatWest Intermediary Solutions is cutting rates on a number of its...
-
Young investors keen to crash the buy-to-let party
As many as four million 18-39 year olds are actively trying...
Sponsored Content
-
Is Scotland’s Housing Market Better Together? ...
Scotland has voted to stay in the union – at least...
-
Data under lock and key ...
Each time I find something interesting in the data the National...
-
95% LTV Second Charge Mortgages, NO ERC’s and Fixed...
Historically second charge mortgages or secured loans as they are also...
-
Record long mortgage terms for first time buyers
An analysis of government house price data by business consultancy Hargreaves...
-
Bank of England Base Rate Cut - when will it happen?
The Bank of England has signalled that more than one interest...
-
How Much Will Mortgage Rates Affect The Housing Market?
Recent economic data was reassuringly predictable. We learned that core inflation fell...
-
Shared Ownership has failed to deliver - MPs slam process and costs
Shared ownership has failed to deliver an affordable route to home...
-
Buy To Let Crisis - lending plummets and arrears soar
There’s been a huge rise in the number of buy to...
-
Lender hires TV property guru to highlight empty homes scandal
Homes Under The Hammer property expert Lucy Alexander is fronting a...
60 second interview
Lee Dahill, Director of Sales for the Today publications and The ValPal Network
Who are you? I’m the Director of Sales for both...
Edward Trustworth, My Tenanted Property - Founder
Who are you? Edward Trustworth, 23 What does it say on...
Maud Rousseau, Searchflow Group Marketing and Communications Director
This week, SearchFlow launches it new brand. Group Marketing...
Comments
The ignorant comment from Mr Patel shows a total lack of understanding, but doesn't surprise me. Advisers can & do recommend direct only deals!! The only difference is that the bank does not pay a procuration fee to the broker. Instead the client pays the broker a small administration fee, or in a lot of cases the broker does not charge a fee, but relies on goodwill and the opportunity to source insurance. This is the best advice for the client, as to push them back into the bank branch would expose them to pressure selling of over-priced bank insurance. Please get your facts straight Mr Patel, or at least renew your subscription of Valium :-)
It is interesting to hear mortgage brokers defend their now obsolete existence here and attacking PAA for telling the truth. I wonder how many of you guys actually tell your customers that they will probably get a worse deal by arranging their mortgage through you? Surely the customer is expecting you to have access to the best deals, especially when you describe yourself as 'whole of market'?
Do any of these so called experts understand that many mortgage brokers are actually allowed to recommend direct deals. We have been doing so for 2 years now with a simple fee based structure. So I dispute how many cases mortgage brokers are involved with as the lender simply does not know when we recommend the direct ones! Please do not assume that all brokers ignore direct products and hope they will go away. Our buisness model has allowed change and we still look at both especially in the 90% LTV market where the brokers products are simply not acceptable.
The 'popular' moneywebsites have no way to source a product accurately over say 2 years total cost to pay which means the many people who think they have a good deal may have failed to notice that the best buy has a whopping great fee making it about the 20th best buy! Buyer beware
The voice of mortgage brokers, as an industry, are not well represented. At the moment, the regulatory bodies are making it more difficult to trade through increased costs and compliance procedures and lenders are trying to sideline the broker industry. What they dont appear to understand is how much time goes into client meetings and discussions, that we invariably allow them to employ less staff by data inputting applications for them and they continue to close branches, open impersonal call centres and employ inexperienced people. Good brokers are there for their clients for many years. They provide a personal service which often extends to family members and friends. The money supermarket and lenders quotes demonstrate that they totally miss the point. What goes around comes around. As a broker, you should vote with your feet. As an industry, we should be aware that the marginalisation of brokers that seems to be systematically going on, is bad for consumers. But who is shouting out for us??
HSBC advised a client on a shared equity mortgage. After 3 weeks they decided they could not carry out this mortgage because the the client could only ever buy 75% of the equity. There initial fact finding was poor and the adviser kept apologising that that was the first shared equity mortgage- he had not done. We sorted it out within a week- SO MUCH FOR A BANKS ADVICE.
If like me you give the clients the best advice then this is a great opportunity. We charge a fee for the advice and if it's best to go direct then thats what we tell the client and write the protection of the back of it. In reality most clients prefer to pay a bit more and have us do the work anyway
I agree with previous comments that say never has advice been more important! I find it ironic to read these comments after PAA have been hounding me for 18 months to try and restart my old account with them. I've just spoken to their development team, and asked them why I should buy leads from MoneySupermarket.com when Kevin Mountford has effectively called our profession obselete? If you want a laugh then give them a call youselves. After the poor guy had stopped spluterring, he gave an expert lesson in how to speak bull under pressure! At the end he had to concede that the comments weren't helpful. That's an understatement!!
I agree 100% with the previous comments that were posted. Advice is everything just now and Money Supermarket can’t give it and nor can most direct lender deals and we know this as we usually have to pick things up from the floor when things go wrong. These direct people seem confident but we will have to wait and see. I for one am sick of their mind numbing adverts which are foul and reek of desperation.
This comment is on a par with Gerald Ratner's blooper many years ago! I'm surprised to hear someone from MoneySupermarket.com say that mortgage brokers are effectively redundant in the market, when they make £000s selling mortgage leads to brokers through PAA Leads. I urge all brokers who are using PAA Leads, who source & sell leads generated exclusively on MoneySupermarket.com to CANCEL THEIR ACCOUNTS IMMEDIATELY, and explain to PAA that this has been done on the advice of Kevin Mountford!!
I just took 10 minutes to compare Trigold and Money Supermarket. If any brokers out there are concerned then do exactly as I have just done they are only talking about 10% deposits the most common deposit amount of 25% (for me) shows that brokers total to pay over 2 years is a lot better than the Money supermarket option. This may be because Money supermarket is inaccurate in its cost over 2 years because trigolds is spot on. (I have checked) This confirmed my suspicions at how poor moneysupermarket is for sourcing as they had 2 out of date deals and also showed deals which are postcode specific with no warnings. So someone could apply to a post code restricted lender online have a credit footprint and have 0% chance of it going through. So in response to moneysupermarkets claims of 9/10 I can see why they dont put this on their god awful adverts because it is totally inaccurate!
If getting the best mortgage deal was as simple as just getting the cheapest rate then no one would need mortgage brokers anyway. We are there to find the best deal for our client's circumstances and long term requirements and to give independent advice. Money supermarket or lenders direct cannot give whole of market independent advice. It would have been interesting to find out what % of clients who got repossessed during the credit crunch had done their mortgages via brokers and how many direct via lenders to see who got the best deals and advice.