Busting a home buying myth – you must use the estate agent’s preferred mortgage adviser

Fact or fiction? Darryl Dhoffer, Mortgage Expert finds out the truth about home buying.

You’ve found your dream home and the estate agent introduces their preferred mortgage adviser – do you HAVE to use them for an assessment to view the property or for your offer to be accepted?

FICTION! It’s a myth.

Although it is completely legal for an estate agent to recommend you use their in-house mortgage adviser, it is ILLEGAL for them to insist you use them.

Let’s get official. The Estate Agents Act 1979 states every offer MUST be put forward to the seller, regardless of where the buyer has obtained their mortgage offer. In other words, your offer to buy the property will be put forward whether you seek advice from their mortgage adviser or elsewhere.

Unless the seller confirms as a condition of any offer the buyer must use a particular mortgage adviser (and this is received in writing), then the buyer is free to use any mortgage adviser they wish.

Remember, the property owner only wants the best price for their property, from a reliable buyer. They really don’t mind where the money comes from, if you can afford the purchase, they’re not worried where you source your mortgage.

But what’s wrong with their preferred mortgage adviser?

Nothing. Well, almost nothing.

Before agreeing to use their adviser, ask the following questions:

Are they independent?

At The Mortgage Expert, we are an independent mortgage broker. It means we can find you the right mortgage from across the whole UK mortgage market.

Many mortgage brokers are part of a ‘mortgage network’ and this can restrict their access to the market. The advice they offer is limited to a selection of providers and they may not be able to find you the very best mortgage deal available.

Do they have your best interests at heart?

An independent mortgage adviser, like ourselves, work only for you, not the Estate Agent. We have no hidden agenda and do not receive or provide a commission to the agent.

Are they directly authorised by the Financial Conduct Authority?

Best to check.

By the way, we are directly authorised. Just saying.

Will they disclose your maximum borrowing amount?

Once the adviser knows how much you can borrow, will they pass this information onto the estate agent, so they can push your offer up? Don’t forget, the agent is paid commission based on the price you pay for the property – it’s in their best interest to get the best price for the seller!

We don’t disclose your maximum borrowing amount – the amount disclosed on your Agreement In Principle is only enough to purchase the property.

One final myth: home buying will be quicker with a preferred mortgage adviser.

Hmm. Why?

An independent mortgage adviser (like us) source mortgages all day, five days a week, month in month out. We deal with estate agents, solicitors, banks, and financial service companies all the time. Why would we make the home buying process any slower?

We have a team of advisers and support staff all ready to answer your query, deal with the paperwork and manage your mortgage application. How many people work for the preferred adviser?

The next time you’re approached by your estate agent and encouraged to use their mortgage adviser, don’t forget to ask plenty of questions. 

If you’re looking to move and would like independent mortgage advice, talk to an expert. Call Darryl and the team today for a no-obligation conversation.