MortgagesJun 10 2015

The search for a shared equity mortgage

twitter-iconfacebook-iconlinkedin-iconmail-iconprint-icon
Search supported by

Each week the mystery shopper seeks advice from independent and tied advisers in the UK. The aim is to find out whether advisers are delivering the goods when it comes to the all-important initial telephone contact between client and adviser. It is only intended to evaluate this first interview, and it is understood that further meetings would be necessary before final decisions could be made. The purpose is not to expose poor selling practices, but to show constructively any weaknesses in the advice process.

This week, the mystery shopper visits South West London. He is a 26-year-old first-time buyer looking for a shared equity mortgage after he was given £30,000 by his parents to buy a flat for around £300,000. He earns £27,000 basic with commission capped at £5,000, and has no outstanding debts. If he cannot obtain a shared equity mortgage he may have to join forces with his older brother, who earns £35,000 a year, to buy a property.

Adviser (Independent):

Globe Independent Financial Advisors, Globe House, 1 Chertsey Road, St Margarets, Twickenham, TW1 1LR

Speed of response:
Time of call: 10.13am. The call was answered after two rings. 5/5

Telephone manner:
Very friendly yet professional. 5/5

Relevant qualifications:
Mortgage adviser MAQ (CII). 4/5

Payment method:
One-off charge of £150 upon completion of the application. 5/5

Guidance given:

The adviser said it would be hard to obtain a shared equity mortgage, those being in high demand. Adding that the shopper’s modest salary might preclude him getting a £300,000 property, the adviser suggested that he team up with his brother to maximise his chances of securing a mortgage with their wages combined, and eliminate the need for a shared equity mortgage. The adviser said the shopper would need to sign up to a housing association list. 5/5

Knowledge:

The adviser displayed comprehensive knowledge of the topic area and the mortgage market, and explored the importance of having a good credit rating when it comes to securing a mortgage. 5/5

Email/web presence:

james@globeifa.co.uk

www.globeifa.co.uk/ 5/5

Verdict:

Very good. The adviser spent a great deal of time explaining how shared equity mortgages work and the options the shopper could consider.

34/35

Adviser (Independent):

Aspen Financial Services Limited, Wickham House, 2 Upper Teddington Road, Kingston, KT1 4DY

Speed of response:

Time of call: 1.16pm. The call was answered after three rings. 5/5

Telephone manner:

Polite yet professional. 5/5

Relevant qualifications:

Level 4 and mortgage adviser CeMAP. 5/5

Payment method:

Payment would depend on individual circumstances. 4/5

Guidance given:

The adviser said that housing associations often offer shared equity schemes, typically aimed at first-time buyers. He warned that the value of a shared equity loan would rise if the value of the property increased. 3/5

Knowledge:

Despite the brevity of his guidance the adviser seemed very knowledgeable. 4/5

Email/web presence:

michael@aspenfs.co.uk

www.aspenfs.co.uk 5/5

Verdict:

The adviser sounded very experience and offered some sound, albeit brief, guidance.

31/35

Adviser (Independent):

Fairway IFA Ltd, 127 Walton Road, East Molesey, Surrey, KT8 0DT

Speed of response:

Time of call: 13.30pm. The call was answered after one ring. 5/5

Telephone manner:

Polite and friendly. 5/5

Relevant qualifications:

Level four diploma and mortgage adviser CeMAP. 5/5

Payment method:

Fee of £330 on reaching an agreement in principle. 5/5

Guidance given:

The adviser explained that shared equity mortgages were almost excusive to new-builds, adding that the shopper would need to register with a housing association. He said that one of the drawbacks of shared equity mortgages was that the size of the loan would increase if the price of the property rose. The adviser added that the shopper could find it difficult to secure a mortgage because of the value of his annual salary. 4/5

Knowledge: The adviser seemed knowledgeable in this topic area, and gave an in-depth explanation on how the government’s Help-to-Buy scheme worked. 4/5

Email/web presence:

fair.ifa@btconnect.com

www.fairway-ifa.co.uk/ 5/5

Verdict:

The adviser gave guidance to the shopper in a clear and concise manner. The shopper was very satisfied with the responses to his questions.

33/35

Provider: Leeds Building Society

Speed of response:

Time of call: 10.26am. The call was answered by an automated system. The shopper was transferred to an adviser after nearly 11 minutes. 3/5

Telephone manner:

Professional. 4/5

Relevant qualifications:

Mortgage adviser CeMAP. 4/5

Payment method:

Dependent on individual circumstances. 4/5

Guidance given:

The adviser explained the difference between shared equity and shared ownership mortgages, She added that shared equity mortgages usually applied to new builds and she explored the possibility of the shopper taking out a Help-to-Buy mortgage. She said the shopper would need to register with a housing association. 3/5

Knowledge:

The adviser displayed good knowledge of Help-to-Buy, shared equity and ownership mortgages respectively. 3/5

Email/web presence:

www.leedsbuildingsociety.co.uk/mortgages 3/5

Verdict:

Although the shopper did not appreciate having to wait so long to speak to the adviser, he found the guidance offered informative and helpful.

23/35