Taking out a mortgage or looking for a good mortgage deal is the single most important financial decision for a great many of us, but recent figures suggest that many home buyers are still not quite up to scratch on choosing the best mortgage broker.
A survey of over 5,000 current home owners reveals that, although a reassuring 65 per cent made sure that they went with a whole of market mortgage broker, a substantial 30 per cent simply didn't know whether their broker was whole of market or not, potentially missing out on the best mortgage deal.
Interestingly, the results of the survey also point to home owners' reluctance to take out any form of insurance as part of their mortgage package, even though it could well provide important financial backup were they or their families to face difficulties further down the line.
Only 35 per cent took out life insurance, and even fewer (26 per cent) critical illness insurance. Even more bizarrely, only 13 per cent opted for building and contents insurance, exposing themselves to potential losses in case of damage or theft.
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'Many home buyers, especially those doing so for the first time, will often go straight to their current banking provider for a mortgage quote and aren’t aware of the restrictions this can place on the potential deals available to them,' comments Alastair McKee, managing director of One77Mortgages, which conducted the survey.
So what is a whole of market mortgage broker? Simply put, this type of broker covers more of the market; they're usually independent with no links to specific mortgage lenders, and that means you can secure the best deal out there, rather than the best deal a tied mortgage broker is able to offer you.
'And while it’s encouraging to see that the majority are opting for a whole of market broker in order to find the best mortgage deal, it’s worrying to see how many aren't, and how many are continuing to take a risk, particularly where life and serious illness insurance is concerned,' continues McKee.
'We appreciate that buying a house is probably the most expensive purchase you will make, and it may feel like you’re being upsold additional insurance cover that isn’t really necessary. However, when the worst does happen, it can plunge people into severe financial difficulty if they don’t have the relevant protection, and we’ve seen this happen on numerous occasions.'