DIY mortgages are cheaper, experts say
BORROWERS can save almost £900 by arranging their own mortgage, a new report says.
Lenders are offering the best rates to those who bypass a broker. Last week the top three-year, fixed-rate deal was Nationwide’s 5.74 per cent mortgage — not available via brokers.
The best three-year deal identified by online mortgage firm mform.co.uk available to brokers came from Nottingham Building Society at 6.79 per cent.
Overall, a borrower taking a £150,000 loan would pay £38,480 for three years with Nationwide and £41,118 with Nottingham — a £2,638 difference, or £879 a year.
“These differences in price are material,” said Francis Ghiloni at mform. “But consumers must search the market because the lenders with the best deals change from week to week..”
For two-year, fixed-rate loans the story is similar. Principality Building Society offers 5.99 per cent with no arrangement fee. Brokers can arrange a home loan with Abbey at 5.95 per cent but this has a £1,290 fee.
However, the Association of Mortgage Intermediaries, representing brokers, says professional advice will save money in the long run. “Independent research shows consumers can save £1,860 a year on a mortgage by using a broker,” a spokeswoman said.
