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Broker fee
There are two ways to arrange your mortgage, either directly with a lender or through a broker.
The advantage of going to a lender direct is that you do not need to pay a broker fee. The disadvantages are that you will not receive any advice on which type of mortgage is best for you, it is highly unlikely that you will get the best deal available, ancillary products such as insurance tend to be overpriced and you will have to go to them (the last we heard the man from the Halifax won’t come and visit you on an evening to discuss your options!)
Independent Brokers search the whole market for you and make a recommendation as to which is the best type of mortgage for your circumstances and also which lender provides the best rate for that type of mortgage.
In return for this and the personal service of the broker looking after the whole application process for you, you will pay a broker fee which will normally be added to the loan. Average broker fees are around 1% of the loan amount although you can often get a discount if you allow the broker to arrange any associated insurances for you.
