News: Landlords set store by mortgage advisers

Booming buy-to-let market sees strong reliance by landlords on mortgage advisers...

Mortgage advisers are providing a much needed lifeline to nearly three-quarters of landlords (74%) who seek advice, according to research undertaken by BDRC for Alliance & Leicester Mortgages.

Almost a third of landlords said they relied on brokers for advice a ‘great deal’ when it comes to letting properties and a further 46% relied on them a ‘fair amount’.

Overall, over half of landlords (55%) are relying on advisers for making them aware of new buy-to-let deals, giving advice on the deals and arranging the actual mortgage with the buy-to-let lender.

The findings identified three key roles that advisers play. Landlords saw the new product information they receive from advisers as the most important factor as it is harder to obtain anywhere else. Joint second was an adviser’s ability to source new deals and arrange the buy-to-let mortgage for them.

Mehrdad Yousefi, head of intermediary mortgages at Alliance & Leicester, said: “From our research, it is clear that advice plays an important part for buy-to-let investors.”

“Landlords need their advisers to obtain information that they can’t easily get hold of themselves as well as helping them get the best mortgage product for their needs.”

“Advisers provide a sounding board which, for many, is crucial in the decision making process and could impact hugely on the landlord’s finances. The fact that half of landlords taking advice remain loyal to one adviser shows just how much they really do value this relationship.”

Landlords arrange to see their mortgage broker on a regular basis – with one in ten seeing their adviser weekly and over a third (40%) seeing their adviser at least once a month,  Only a very small number (2%) wait for the adviser to contact them. 

Buy-to-let has been one of the success stories of the mortgage market in recent years. Whilst it has traditionally been favoured by professional landlords, good returns and a flourishing housing market has attracted a wider range of investor. However, it is evident that landlords value the sound advice and support that advisers can offer.

Mehrdad Yousefi added: “It is evident that mortgage brokers have an important role to play in the buy-to-let market, now and in the future. As landlords gain more experience, they may develop confidence and feel better equipped to make their own decisions and then may choose to go direct to a lender.”

“However, advisers can sometimes provide better, more competitive deals which may not be accessible if they go direct to lenders.”

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