Why should you use a mortgage broker?
Do you want to know why you should use a mortgage broker? Here we explore the top 5 reasons why you should use a mortgage advisor, rather than trying to do it all yourself.
What is a mortgage broker?
If we are asking why you should use a mortgage broker, it’s important to understand what they do.
A mortgage broker is someone that specialises in finding mortgages for people. A mortgage advisor will provide advice and make a recommendation to you based on your personal circumstances. Ultimately this means you should get the best mortgage deal for you. There are many benefits to using a mortgage broker, some of which we will mention below. They have to be regulated by the Financial Conduct Authority. Your broker should inform you of this before undertaking any advice or recommendations. If they are not regulated, run a mile! Also you want to use a broker who is ‘whole of market’. This means they are not tied to any specific mortgage provider and have access to a large panel of mortgage lenders.
Top 5 reasons why you should use a mortgage advisor?
Let’s look at some of the reasons why you should use a mortgage broker:
- Get the best deal for you
- Save time
- Less hassle
- Intermediary exclusive mortgage deals
- Specialist advice
Get the best deal for you
One of the main reasons to use a mortgage broker is that you should get the best mortgage deal for you. The advice and recommendation process involves learning about the client and their needs. Then using that information to source the best possible deal for the applicants based on their individual circumstances. A large part of finding a mortgage is the way each lender assesses affordability. This can vary dramatically between mortgage providers. Trying to understand each lenders affordability and the way they assess each applicant would take up so much time.
Other things that can effect the maximum mortgage amount are any unsecured debts you may have such as loans, car finance, credit cards, store cards etc. Each mortgage lender will assess these things in their own way. Additionally, any children you may have will play it’s part. Also, the type of income you have is very important. If you receive bonus or commission it can get really tricky if you don’t know the market well. This is why using a broker that is ‘whole-of-market’ can be so useful.
When you consider the above, I think this next point is self explanatory. Reason number 2 why you should use a mortgage broker is that it will without doubt save you time.
I’m sure there are people out there that have got lots of time on their hands and maybe even enjoy spending hours trawling the internet trying their best to find the best mortgage deal. However, for the vast majority of clients we help, saving time is a big reason to use a mortgage advisor.
This becomes even more important if you deviate from the norm. The more complex the situation, the more time it is likely to take someone to be able to find the right deal themselves. Additional borrowing, complicated income, self-employed, adverse credit, low credit score and so on. Trying to get this right on your own could take a considerable amount of time.
Leading quite nicely onto the next reason to use a mortgage advisor – less hassle.
I think by now you may have realised that if nothing else it will be a much easier experience to use a mortgage advisor than it can be to try and find your own mortgage deal. In the modern world, people want convenience. People generally want an easier life where possible. Using a mortgage broker should help this. You will still need to provide a broker with the relevant documents such as ID, income verification, bank statements. However, your advisor will then take care of the whole process, finding the best deal for you, completing the decision in principle and the full mortgage application in it’s entirety. Dealing with any queries from the mortgage underwriter, and managing the application through to mortgage offer.
That said, even when using a mortgage broker it may not always be plain sailing. Again, this reverts back to how complex the case is. Are you trying to borrow the maximum to afford the house of your dreams. Perhaps there have been some defaults or CCJs in the past, maybe for a employed person your company profit has declined. These are the kind of scenarios that may always present a few obstacles along the way. That said, a good mortgage broker will be able to navigate any hurdles and get your the the finish line. They take care of everything. Trying to do that on your own may not be for the faint hearted!
Intermediary exclusive mortgage deals
Reason number 4 why you should use a mortgage broker is the intermediary exclusive deals. There are mortgage providers out there that only work with mortgage intermediaries. This means there are mortgage products available that you simply would not have access to if you tried to find a new mortgage deal yourself online. Accord Mortgages for example are an intermediary exclusive lender and they are often a great choice for a client that may be struggling to get a mortgage elsewhere for a variety of reasons.
In addition to this, many mortgage lenders have intermediary exclusive products. This means that even if you could access that lender yourself online, you still might not be able to get the same deals that a mortgage broker has access to. Simply because the lender may have a range of products reserves exclusively for mortgage advisors.
The last in our list of reasons to use a mortgage broker is specialist advice. We touched on this in the other sections above. If you have a situation that is anything other than vanilla, it can sometimes be very tricky to find a mortgage at all. Some examples of situations where you would benefit from speaking to an expert mortgage broker could be but not limited to:
- Self-employed mortgages
- Sole traders
- Limited company directors
- Using company profit for mortgage affordability
- High level of unsecured borrowing
- Needing to borrow extra to pay off debts
- Additional borrowing for home improvements
- Borrowing the most you can afford
- Remortgaging to use extra funds for business purpose
- Needing to remortgage for extra cash to extend the lease of a leasehold property
- Bad credit mortgages
- Missed payments
- Historical defaults
- CCJs in the past
- Past bankruptcy
Of course it is possible to find a mortgage deal yourself. For some people this may be the right thing to do. For many other people using a mortgage broker is exactly what they need.
When you need a mortgage, hopefully this information may help you decide if using a mortgage broker is the right thing for you.
Fifty Nine Financial are a friendly, online mortgage broker firm based in Derby. Although we have clients all over the UK.