Only 18 per cent of homeowners seek independent advice
The results of the study revealed only 18 per cent of today’s homeowners approached an IFA for advice, despite 70 per cent of British non-home- owning adults acknowledging the importance of seeking advice before entering into mortgage arrangements.
64 per cent of non-home-owning Brits also expressed the need to receive independent financial advice when arranging protection and investment products alongside a mortgage.
Only 8 per cent of potential homeowners looking to step onto the property ladder in today’s climate admitted they would make an IFA their first port of call while 41 per cent of those questioned suggested they would approach their bank or building society for advice.
However, having stepped onto the property ladder, 30 per cent of homeowners who remortgaged did so through an IFA.
Further findings from the IFA Promotion study revealed only 18 per cent of homeowners claim to understand the mortgage sector. This is in tandem with recent FSA research revealing that 56 per cent of mortgage holders and first-time buyers did not know what APR stood for.
Karen Barrett, marketing director of IFA Promotion, said more consumers needed to realise and take advantage of IFA’s expertise on offer. She said: “Our research shows that while most people instinctively know about independent advice for these purchases, they are not taking it.”
Alan Lakey, senior partner at Highclere Financial Services, was unsurprised by the findings. He said: “Two of my good clients recently decided to leave as they didn’t think there was much difference in going straight to the lender. It is definitely a question of education.
“ What consumers don’t realise is the wealth of difference in products and anyone who does not approach someone with knowledge of the market could potentially lose thousands of pounds.”