There is a misconception among many people that getting a mortgage is all about heading to your bank and filling out the paperwork they give you.
The problem with this is that it means you will probably miss out on finding the perfect deal for your circumstances. Think of it like searching for your next energy provider – you want to look in detail at all your options before you commit to one for the foreseeable future. The difference is, with energy providers you can simply head to a price comparison website, but with mortgages, it’s not so simple. This is why mortgage brokers exist.
What is a mortgage broker?
Mortgage brokers are specialists in finding lenders who meet the specific needs of their clients for a mortgage. This is achieved by offering you detailed, expert advice and recommending the mortgages that are the best fit from a vast pool of options. Once the best choice has been identified, they will manage the process of applying for your mortgage through to completion. Mortgage brokers must be regulated by the Financial Conduct Authority (FCA), and must have completed certain qualifications to be a professional mortgage broker.
So, a mortgage broker will:
1. Assess your needs through an in-depth consultation. This means listening to what you need, assessing your financial circumstances and getting to know about your personal situation.
2. Present recommendations based entirely around your needs. This involves examining the 10,000+ products we have access to in order to find the best fit for you.
3. Handle the application on your behalf to save you the stress. This enables you to focus on the important stuff, like planning your move or thinking of ideas for your interior decoration!
What are the advantages of using a mortgage broker?
Now that you understand better what a mortgage broker is, and what they do, it’s important to understand why it can be helpful to work with one. Going directly to your bank has its positives, and we’re not going to tell you to rule that out just yet. However, we know that there are many home buyers who find they get the following benefits from working with a mortgage broker:
1. It may help you save money
Part of a mortgage broker’s service is ensuring you are never paying more than necessary. They will assess your financial circumstances and identify the best mortgage option for your requirements. The recommendations we make at Think Plutus always put your needs front and centre. We are able to draw from more than 100 mortgage lenders, meaning we examine more than 10,000 products to identify the best one for you. What’s more, if a lender turns you down, we will try another option. We are also able to access exclusive deals that you won’t find anywhere else, which might land you the perfect mortgage.
2. It will save you precious time
Modern life can be hectic, and our advisers at Think Plutus are always flexible with appointments. We can provide evening and weekend meetings, either in person or over the phone, and we can meet you at a location that suits you. If you don’t have time to come down to our office, we’ll find another way to get all the necessary information from you and give you the right advice.
3. You get real value for money
Most mortgage brokers earn their money through fees and the commissions that lenders pay. Some online only brokers will not charge a fee and rely entirely on this commission. At Think Plutus, we charge a fee for our service, because this enables us to devote more time to you.
We want to give you the time to tell us everything, air your concerns and feel comfortable with every decision. We want to devote more time to advising and supporting you, with a true focus on your needs, instead of the value of the commissions from different lenders. A mortgage is probably the largest investment you will ever make, so it’s important you feel confident you’re getting the best advice to find the best deal.
What happens if a mortgage broker gives bad advice?
When giving you mortgage advice, a mortgage broker has a duty of care to you. After all, you’re putting your faith in their expertise to help you make important decisions involving large amounts of money.
A mortgage broker must recommend a suitable mortgage for you, and be able to offer detailed justifications for the recommendations they make. If you find that the advice they give is flawed, you can complain and possibly obtain compensation for any losses you incur.
Why do some people still just go to their bank?
Some people opt for a bank or building society, as opposed to a mortgage broker, because they like the familiarity of it. Some even feel a sense of loyalty to their bank, particularly if they have been long term customers and like to see someone they recognise when they visit. In some cases, banks will offer a special discount to loyal customers who choose them for their mortgage, and this can be a powerful factor to influence a decision.
However, it’s important to keep in mind that when you go directly to a bank, you limit your options to a single lender. If you’re lucky, you may find that this lender genuinely ticks all your boxes and their product is perfect for you. However, it is much more likely that what they’re offering doesn’t truly measure up, and you’re forced to make compromises on things you would really prefer not to. This is why it’s good advice to go to a mortgage broker and take advantage of their ability to access a more comprehensive range of mortgage products.
How do you prepare for a meeting with a mortgage broker?
If you have booked an appointment with a mortgage adviser, they will have informed you of what they need to see from you. If you are wondering what you will need, it generally starts with evidence of your income and expenditure (including that of anyone else who will be on your mortgage application). Bank statements and payslips are helpful for this.
It’s also good to check which insurances you have in place and get a clear idea of the value and type of property you are looking to buy.
Have a think about the type of mortgage you would like, for example, whether you would like a fixed interest rate on your mortgage, or whether you’d be comfortable with a lower-rate variable mortgage that may change down the line. If you are well-prepared with all this information, you will likely find your appointment with an adviser is more productive and efficient.
Should you work with a mortgage broker?
Everyone is different, and it isn’t for us to say that there’s a one-size-fits-all solution to getting a mortgage. There is no such thing as a ‘right’ or ‘wrong’ choice here, and we aren’t going to tell you that you’d be making a mistake choosing either option. What we will say, however, is that the best way to make the right choice is to make sure you have all the information you need to know. If you’d like to learn more about how we work over at Think Plutus, please feel free to get in touch and we’ll be more than happy to answer any questions you have.
Ultimately, we want you to be happy with the choices you make, and we’d love to hear from you to see if we can be of assistance.