How to get the best mortgage deal

We all want the best mortgage deal. But where should you go to get it?

Did you know that the Association of Mortgage Intermediaries has 8,000 and 10,000 members, and represents more than 80% of mortgage brokers?

No? You didn't know that?

Let's face it. Unless you spend your evenings surfing the Association's website, you probably didn't know that. And you probably don't find it very interesting, either.

So you'll be even less interested to learn that, this week, yet another broker launched into the market.

But you may be interested to learn it's HSBC. The bank has just launched an in-branch brokerage service that charges £150 if you get a mortgage with them. As this bank has been offering some of the best mortgage deals recently, it's certainly a change of note. Here are the pros and cons of the service:

HSBC mortgages

HSBC and its telephone and Internet subsidiary First Direct will still be offering their own mortgages. The deals have been the cheapest or almost cheapest during most of the financial crisis, which is an unusually long time. What's more, HSBC is decreasing the deposit required on some of its own mortgages from 40% to 25%. This change in the deposit requirements should make it a little easier to get an HSBC loan.

Independence?

Any ordinary broker can be influenced by the commissions it receives. HSBC has this problem too, but in addition it will get vastly more money for people signing up to its own mortgages. This is another conflict of interest, as HSBC mortgages won't be the most suitable for everyone, and the bank won't be competitive forever.

Whole of market?

HSBC mortgages will be available from this bank only. Other mortgage brokers won't normally offer HSBC products. On the other hand, the number of other lenders and mortgages that HSBC will compare with its own will be limited in my view.

Let me explain. HSBC is calling itself a whole of market broker. However, true whole of market brokers can offer advice on a wide range of deals from different lenders. If you follow their advice, and it turns out to have been unsuitable, you have the protection of the Financial Services Authority and can get compensation for any problems that arise.

HSBC brokers will use whole-of-market data from comparison site Moneyfacts to compare mortgage deals for you. Its brokers will tell you which deal comes out top. But they won't be able to formally advise you about which deal to take - unless, of course, that deal is an HSBC deal. So, unless you choose a deal from HSBC, you won't have the protection of the Financial Services Authority if it all goes pear-shaped later - the way you would with a true whole of market broker.

Availability of HSBC's new service

HSBC says this is a seven-month trial. Over the next few weeks, 20 branches will begin to offer it. The bank says it doesn't want to be overwhelmed with applications, so it'll just write to its nearest existing customers to announce the scheme. The branches are:

• Reading Broad Street
• Guildford High Street
• Clapham Junction
• Wimbledon
• Leicester Granby Street
• Ipswich Tavern Street
• Chiswick 281 High Road
• Ealing Broadway
• Kingston-upon-Thames Eden Street
• Edgware Station Road
• Harrow Street Ann's Road
• Milton Keynes Midsummer Place
• Croydon Central
• Oxford Cornmarket Street
• Cardiff Queen Street
• Southampton High Street
• Newport Gwent Bridge Street
• High Wycombe Corn Market
• City of London, Queen Victoria Street

What to do next

1. If you use HSBC's service and are offered one of its own mortgages, check on the internet or with another broker to make sure you're not missing a better deal.

2. If you were rejected recently on the basis of your deposit size alone, you may want to have another go, but remember that both HSBC and First Direct mortgages are still likely to be reserved for customers with the best risk profiles.

3.  If you have applied but were rejected for some other reason, you should consider a fee-free or discount broker, so you can compare a wider range of mortgages without paying the £150 charge.

And finally....

I should acknowledge that lovemoney.com operates its own mortgage broker service. We think it's a good service, but, who knows, the folk at HSBC may disagree.

> Compare thousands of mortgages with ease using lovemoney.com's mortgage service.