Do you need a mortgage broker?

Do you really need a mortgage broker? Can you go it alone? Or should you use a professional?

While you might think that a DIY mortgage application will save you money, it could end up costing you more in the long run. In this guide, we explain why and discuss the benefits of going with a broker. We’ll also discuss the best time to speak to a mortgage adviser.

What is a mortgage adviser or mortgage broker?

A mortgage broker can be an independent professional or work for a company. Your broker will arrange a mortgage between you and a lender, whether you’re buying a new property, remortgaging your existing home, or are a first-time buyer.

They work with you to understand your mortgage needs and personal situation and will explain the different types of mortgages available. A mortgage adviser will help you choose the right mortgage for you. They will find you a deal by searching the market for suitable available mortgages to fit your requirements. And they will also help you with the mortgage application.

What are the benefits of using a mortgage broker?

Firstly, you don’t have to use a mortgage broker; you can instead directly apply with a lender.

However, here are the benefits of using a mortgage broker like Better.co.uk:

• Expertise - Mortgage brokers have a wealth of experience and in-depth knowledge of the mortgage industry, lenders and their different criteria. They can provide valuable advice and guidance to help you make an informed decision.

• Access to deals - Brokers have access to various mortgage deals, saving you time and effort in researching and approaching multiple lenders.

• Easy comparison - A mortgage broker will provide you with multiple mortgage options from lenders they think will be most suitable for you. This means you can more easily compare interest rates, terms, fees, and features.

• Simplified process - Mortgage applications can be complicated and require a lot of paperwork. A broker can streamline the process and ensure all necessary documentation is submitted accurately and on time.

• Tailored recommendations - A mortgage broker can recommend mortgage products that align with your financial goals and needs.

When contemplating the choice of using a mortgage broker, several factors warrant consideration, including any costs associated with their services and the extent to which they conduct thorough lender comparisons. It's important to ascertain whether a broker impartially assesses a wide array of lenders or if their affiliations limit them to particular lenders or a specific network. If you’re not sure, don’t hesitate to ask—brokers have a responsibility to be transparent about this aspect.

If a broker is fee-free, ask them to explain how they make money. Typically, brokers earn their income through commissions paid by the lenders. Researching and asking about this helps ensure that your mortgage recommendation is unbiased and well-suited to your needs.

Mortgage brokers at Better.co.uk have access to over 12,000 mortgage deals from 100+ lenders across the market by being part of a dedicated mortgage panel. Our advisers also have detailed knowledge of the different mortgage products available from different lenders and government homebuying schemes that you could take advantage of. It’s what they do every day. Doing this by yourself will take a lot of research.

They will also support you on your application and guide you through the paperwork, which can often be confusing and stressful. A good mortgage adviser will also advise you on improving your chances of being accepted for the mortgage; this is crucial for first-time buyers with a small deposit or if you’re self-employed. 

Risks of not getting advice

First and foremost, if you don’t get mortgage advice, you could miss out on the right deal by not tapping into the insight of an experienced broker. You could end up applying for a mortgage that doesn’t suit you. Or you could apply for a mortgage where you don’t meet the lender’s criteria.

Secondly, if your mortgage later turns out to be unsuitable, you have more rights if you take mortgage advice. You can file a complaint and even take this to the Financial Ombudsman Service.

If you don’t take advice, you must take responsibility for your mortgage decision. 

Do mortgage brokers get better rates?

Working with an online mortgage broker like Better.co.uk means you should get access to the most suitable rates for your situation. We have working relationships with lenders and know when new deals may become available.

Yes, you can do your research across multiple lenders, but without industry experience, there’s no guarantee your final choice will be the right fit. Or the most suitable rate.

Should you use a mortgage broker or go directly to a bank?

So, mortgage adviser or bank? What do you think?

If you go directly to a bank, you can only apply for their available deals. You may be missing out on more suitable mortgages elsewhere. Crucially, you may also have picked a lender that isn’t always suitable for your circumstances. For example, certain banks are more willing to lend to self-employed people or first-time buyers.

By working with a broker, you’re trusting that they understand the lending approach of different banks.

How to find a mortgage broker

The mortgage broker you choose will significantly impact your mortgage application process. A good one will make the process smooth and could save you time and money by finding you the right deal.

Here are some steps you can take to help you find the right mortgage broker:

1. Check broker reviews from previous and existing customers. Testimonials can provide insights into a broker's reputation and customer service. You should also ask friends and family for recommendations, ask about their experience, and ask whether they’d use the broker again.

2. Remember to check that the mortgage broker you choose is regulated by the Financial Conduct Authority (FCA).

3. Compare the fees associated with each broker on your shortlist; some may come with large fees, whereas other mortgage brokers, like us, won’t charge you anything. All mortgage brokers must be upfront with you and clearly outline any charges and their commission before entering into a contract on your behalf.

4. Find out how quickly they can start working on your application. Ask for a suggested timeframe for the completed mortgage to evaluate this against your expected timeline to complete your purchase. Remember, they can control when they start working on your case but can’t necessarily control how long the application takes. This will depend on the lender, but your broker should be able to advise on potential timescales.

5. You must also trust your broker. Remember, you’ll be sharing personal information and financial details with them. Do you like the way they talk to you? Do you find the advice they’re giving you helpful? Does it feel like they’re doing everything they can? And is their advice tailored to your needs? If yes, then great. If not, you may want to consider looking elsewhere.

When should I speak to a mortgage broker?

You should speak to a mortgage advisor right at the start of the process. It might be your first mortgage, a move to a new property, or a remortgage. Whatever your circumstances, getting professional help immediately will save you time and effort in the long run. A good broker will understand the mortgage process, explain everything you need to know, and help you with your application.

Choosing the right broker should also save you money on your mortgage. With the right knowledge, experience and access to deals, they should find you the most suitable mortgage rates and terms for your needs.