Since January 1, 2013, it is no longer permitted to settle commission on the product. The consultancy and mediation costs must be charged directly to the customer. This encourages independence, but does that also apply to the bank? In the past, too high costs were included in financial products. The costs included in insurance and mortgages were hidden. It was not clear to the customer how many costs were included in the product. To prevent this undesirable situation, the cost structure is now better monitored. By completely separating the advice and mediation costs from the mortgage interest and insurance premium, clarity is created.
Increasing competition and more independence
By making costs clear, competition between advisors should be stimulated. In the past, advisors were sent to a specific bank or insurer based on financial interests. One lender provided a higher compensation than the other lender. By having the bill paid directly by the customer, the focus is again on the customer instead of on the advisor’s own interests. The advisors are now no longer dependent on the banks and insurers they work with. Their job is to choose the best product for their customer. Will the bank’s advisor now also advise you to take out a mortgage with another bank?
Is the bank’s advisor independent?
The question is how independent the advisor on the bank’s payroll is. Will an advisor from ING or Rabobank advise a mortgage from ABN Amro? Or from an insurer? No, the Rabobank advisor will recommend a mortgage from Rabobank. An ABN Amro advisor will advise on a mortgage from ABN Amro. The advantage of the bank’s advisor is that he or she knows the product well and is also aware of all the positives and negatives of the product.
Seek advice from an independent mortgage advisor
You cannot expect a bank advisor to recommend a mortgage from another lender. Based on this, you would say that you are better off with an independent advisor. In practice, however, it appears that they generally advise mortgages from one of the major Dutch banks. In the past you could obtain advice from several advisors, but because you now have to pay the advisor per hour, it has become more difficult to obtain a second opinion. Is the independent advisor experienced enough and does he or she have the knowledge to provide you with sound advice? Advice remains a matter of trust.
Should you choose the bank or the independent advisor?
Unfortunately, no clear advice can be given here. The problem is that you have to rely on the advisors who will provide you with the advice. In any case, first arrange a free introductory meeting with the advisor. During this conversation you should feel whether the advisor in question can provide you with good advice. Ask about knowledge and experience in mortgage advice. An experienced advisor will provide you with better advice compared to a less experienced advisor. This applies not only to the independent advisor, but also to the bank’s advisor.