Comparison website moneysupermarket.com has launched a blistering attack on the mortgage broker community by claiming advisers offer limited choice as 90% of deals are available direct only.
The website says lenders are offering better deals and the days of brokers offering a whole of market range of products are gone.
Kevin Mountford, head of banking at moneysupermarket.com, says: “The lack of supply and high demand means lenders can take full advantage of the current situation rather than having to push their products through brokers, which they previously relied on.
“As a result, anyone using a mortgage broker needs to be aware that the range of products available may be limited.”
He adds that intermediaries should be seen as part of the shopping around process rather than the final word in mortgage products.
Council of Mortgage Lenders’ data shows that 71% of first-time buyers used intermediaries to get a mortgage in Q1 2010, compared to 67% in 2006.
Intermediaries also accounted for 57% of the volume and value of deals in the home mover market and 61% of the volume and 64% of the value of remortgage deals.
Dev Malle, group sales director at Personal Touch FS, says moneysupermarket.com are, “talking a load of old tosh”.
He says: “The consumer will vote with their feet. Clearly what the consumer values is telephone or face-to-face advice to help them tackle what is still a maze of thousands of products. What is required is a complete understanding.
“No one has yet found a solution to replace intermediaries, either through the internet or direct products.”
HSBC, who has never offered deals via intermediaries, is backing Moneyfacts analysis that 93% of the lowest deals are direct-only.
The research surveyed 96 of the lowest rate deals over the last two years and found only six were available to mortgage brokers.
It says the difference between the best broker and best direct deals is 0.31%.
Martijn van der Heidjen, head of mortgages at HSBC, says customers can no longer rely on brokers to get them the best deal.
He adds: “Going to a broker can be a useful part of this process, but as this research clearly shows it definitely shouldn’t be seen as the route to guaranteeing you the best deal. Borrowers need to check newspaper best buy tables, comparison sites and lenders directly.”
Mortgage Strategy is fighting for the future of mortgage brokers with a campaign and petition to be presented to the Financial Services Authority and the Treasury.
The petition has been signed by 815 people and is open until August 31.