55% of UK consumers are unaware that a mortgage broker could offer more product choice than a bank or building society, according to a Legal & General Mortgage Club’s Mortgage Myths – Value of a Mortgage Broker research.
The campaign aims to tackle the misconceptions buyers might have when securing a mortgage and shine a light on the role advisers can play in helping consumers find better deals.
The research found that 48% of homeowners and those looking to buy who did not use a broker chose not to because they felt that their bank or building society offered them a good deal, 15% thought that they would get a cheaper mortgage going direct, and 19% of consumers ‘didn’t see the value’ a broker would add.
19% of all respondents surveyed thought that brokers and banks have access to the same mortgage products and deals. This is despite there being 3,721 products available to consumers who go direct, compared to 29,886 for those who use a broker.
When asked whether they agreed with a series of statements about mortgage advice, 14% thought their bank or building society would be able to give them access to the same impartial advice as a mortgage broker. The Mortgage Myths campaign aims to put the spotlight on misunderstandings like these, highlight the valuable role of independent advice from a mortgage broker and encourage consumers to speak to an adviser about their mortgage options.
Legal & General Mortgage Club’s survey also showed that the majority of borrowers were unsure about the role of a broker and how an adviser could help them with finding a mortgage. Only 44% correctly identified that a mortgage broker works primarily for the borrower, while 29% thought brokers worked on behalf of the lender.
Jeremy Duncombe, director of Legal & General Mortgage Club, said: “These findings show there are a number of misconceptions consumers hold around the role of a mortgage broker, particularly when it comes to understanding who the broker is there to support. As an industry, there clearly is a significant amount of work to be done to change these attitudes, educate consumers and promote the advantages of using a mortgage broker.
“Although some consumers appear to believe they have secured the best deal possible by going directly to their lender, without speaking to a broker they could be missing out on thousands of mortgage products that might be even better suited to their needs., Brokers can offer consumers exclusive rates to their benefit and provide them with access to specialist lenders if they haven’t been successful on the high street. Ultimately, we hope our campaign will encourage brokers and the wider industry to dispel the myths surrounding mortgages and encourage consumers to speak to a professional mortgage adviser, who can guide borrowers and provide best advice when making the biggest financial decision of their lives.”