If you have been considering applying for a mortgage, you may have wondered whether it is worth consulting with a mortgage broker. In this concise introductory guide, we will be looking at some of the pros and cons of working with a broker, rather than taking your business directly to a bank or lender.
What is a Mortgage Broker?
A mortgage broker is either an individual or an organisation that serves as a ‘go between’ for borrowers and lenders. When you approach a broker with the intention of taking out a loan, they can help you decide on the most appropriate product to suit your needs and compare the market to find you a good deal.
As most brokers are independent, they cancompare deals from a variety of lenders – many of which may offer their services exclusively via brokers.
Why Use a Mortgage Broker?
One of the biggest benefits of working with a broker is the simplification of the market comparison and application processes. Once you have provided your broker with a few basic details, they will typically handle most of the subsequent complexities on your behalf.
Working with an independent broker also means gaining access to honest and impartial information, which is rarely available directly from a bank or lender. Brokers can also provide access to exclusive deals you won’t find on the High Street, often from lenders that do not work directly with the public.
What Are the Pros and Cons of Mortgage Brokers?
The pros and cons that accompany working with a mortgage broker include the following:
- Simplicity – The job of the mortgage broker is to do most of the hard work on your behalf, comparing viable and competitive deals from as many lenders as possible to find your perfect mortgage.
- Expertise – An experienced and reputable broker can also help you choose from the various mortgage products and home loans available, ensuring you make the right decision to suit your requirements and your budget.
- Impartiality – With no direct ties or exclusive affiliations with major banks or lenders, independent brokers are free to offer 100% honest and impartial advice for the benefit of their clients.
- Costs – Some brokers impose fees or commissions on the services they provide, which may be chargeable to the applicant, the lender or both. It is therefore important to check the broker’s fee structure before going ahead.
- Limitations – Not all brokers provide access to all lenders on the UK market, when carrying out their mortgage comparisons. Again, it is therefore important to check the broker’s panel of partner lenders before getting started.
- Experience – Verifying the background, experience and track-record of any given broker is essential, in order to ensure that they are in a suitable position to provide you with the advice and support you need.
Prior to committing to any given broker, book an obligation-free initial consultation and ask all the questions you need to decide if they are up to the job.