Many people seek advice from a mortgage advisor or broker because even if they have a good understanding of the different products, there are always new styles and deals available. A good mortgage advisor should therefore be able to offer some real value.

There are two main groups that can offer you mortgage advice;

1. Banks, Building Societies etc
2. Independent mortgage brokers.

• An examples of a mortgage broker/advisor is Charcol Online
• Be very aware though because many firms masquerade at giving advice but in reality just sell you their own overpriced deals
• Until now mortgage advice has been regulated by a voluntary code of practice, the Council of Mortgage Lenders' Mortgage Code
• Any advisor you deal with must give you a copy of this code when offering you advice
• This is all going to change from 31st October 2004 when the Financial Services Authority (FSA) will start to regulate the sale of mortgages

Different Types of Advice

There is a difference between advising about a mortgage and advising about investments that make up the mortgage. For example if you go for a simple repayment mortgage then this would be covered under mortgage advice. But if you were to choose an endowment mortgage then advice into where and how you invest the endowment is actually investment advice.

• All of the big name companies such as the banks and building societies offer both forms
• But some independent mortgage brokers can only offer advice on the actual mortgage itself
• If you decide to do business through a mortgage broker check to see what he can and can't advise on because it could get expensive having to pay two sets of advisors

Also be aware that some mortgage advisors notably Banks and Building Societies can only normally recommend the products that their companies offer. Independent Mortgage Advisors have no such restrictions and therefore generally offer far more impartial advice.

Payment of Mortgage Advisors

• Mortgage advice is normally not free and will either be paid via fees added onto the mortgage bill or by a separate invoice levied by your mortgage broker
• Fees are generally transparent but like anything in the personal finance world they can vary enormously from provider to provider
• It may also be cheaper going to the lender direct rather than doing business through a mortgage broker
• One interesting point to remember is that if you seek advice but do nothing with the recommendation (ie do not take out the loan) for 6 months then the maximum you should pay is just £5
• So if you've paid more then you're entitled to a rebate