For many people, buying or selling a house can prove to be a difficult process. In fact, 24% of people think that buying a home is the most stressful life event, while an even higher 26% find selling a house most challenging, according to a survey by Vivo.
Whether you’re new to the property market, struggling to secure a mortgage, or simply don’t have time to research the best deals, it’s easy to feel a bit lost when you’re trying to relocate. One way to get things moving in the right direction is to seek the advice of a mortgage broker, who can simplify the process and ease some of the burden.
However, before you jump straight in, it’s important to get clued up about what a mortgage broker does and what they can offer you. This guide aims to do just that. We will cover:
- What does a mortgage broker do?
- Do I need a mortgage broker to buy a house?
- Are mortgage brokers worth it?
- When should I speak to a mortgage broker?
- How do I choose a mortgage broker?
- What to ask your mortgage broker
What does a mortgage broker do?
A mortgage broker is a specialist advisor who will help you to find a mortgage for the property you wish to buy, or help you remortgage your current home. Not only will they advise on the various mortgage rates, but they will also make sure that any deal it is right for your personal circumstances.
The role of a mortgage broker is to act as a go-between between you (the borrower) and the bank or building society (the lender). A good mortgage broker will provide a complete service from the start to the finish of your move.
Here are some of the steps you can expect as part of a broker’s service when buying a home:
- Your mortgage broker will first sit down and speak to you to get a clear picture of your situation and review your existing documents.
- They will then scour the available mortgage deals to find the right product to fit your needs, narrowing your options down to a shortlist. They will present these in a clear and digestible format, so you can make the right decision.
- Your broker will work with you to complete your mortgage application, ensuring all the forms are filled in correctly and that it’s accompanied by the right documents. They will then submit your application to the lender.
- Once you’ve been approved, they will assist in finalising a contract with your lender and oversee the signing of your mortgage agreement. They will make sure that you fully understand each part of the document.
Can a mortgage broker help me sell my home?
A top mortgage broker will be willing to guide you through the selling process if you are moving from one property to another, making sure all the finances are just right. You may also wish to port your current mortgage to your new home, and your mortgage broker will help you decide if this is right for you, as well as arranging it.
Here at The Mortgage Genie, our team is highly experienced in helping home movers secure a mortgage on new property at the same as liaising with estate agents on the sale of their current house. We’ll help to ensure there are no unnecessary complications for a smooth transition. We can also assist in porting your mortgage across to your new property, should you wish to explore that option.
Can a mortgage broker help me remortgage my home?
A mortgage broker can help you arrange a remortgage for your home, saving you money in the long run with a better rate. Remortgaging takes less time and effort than buying or selling a property, but if you find that you simply don’t have the time, or you aren’t confident about securing the most suitable deal, a mortgage broker can work with you to understand your needs and help you make the switch.
If you think that you could benefit from a remortgage on your home, our remortgaging guide can help you make an informed decision. And, The Mortgage Genie remortgage team is always on hand to answer any of your questions and help you get started.
Do I need a mortgage broker to buy a house?
No, you don’t need a mortgage broker to buy a house. However, it’s highly recommended that you get specialist advice for this important financial decision. Doing so can also give you access to exclusive deals and specialist lenders that you can’t get on your own.
Here in the UK, over 70% of mortgages are now arranged by a broker (IMLA), showing that more and more people are using this type of service to access the best deals on the market. It’s not really a question of whether you ‘need’ a mortgage broker, rather whether using one is right for you.
Should I use a mortgage broker or find a direct deal myself?
As we’ve mentioned, you are free to seek a mortgage either directly on your own or through a broker. To help you decide which option is most suited, in this section we will take a closer look at some of the advantages and disadvantages of both.
Finding a direct deal yourself
|✔ Access to exclusive direct deals||✖ No access to broker-only deals|
|✔ No broker fees||✖ Knowledge of market required to find best deals|
|✖Research and comparing can be time-consuming|
|✖ No support with application process|
|✖ Need to arrange insurance cover separately|
Using a mortgage broker to find a deal
|✔ Access to exclusive broker-only deals||✖ No access to direct-only deals|
|✔ Expert knowledge of the market||✖ Potential broker fees|
|✔ Less time-consuming|
|✔ Support throughout application process|
|✔ Assistance with arranging insurance|
You can choose to apply for a mortgage product on your own through a bank or building society. By doing so, you can often access deals that are only available to direct customers and you won’t have to pay any mortgage broker fees.
However, this is really where the benefits end. Opting not to go through a mortgage broker means you will be missing out on their expert knowledge of the market and ability to get you the best deal. This means that you will need to research the market yourself and compare products, which can be hard work.
They can also help you to organise essential insurance required to take out a mortgage, streamlining the process further (we’ll take a closer look at this in the questions you should ask a mortgage broker section).
The industry knowledge of a mortgage broker is an asset that really can’t be overstated, especially if you are looking for a specialist lender to suit your financial circumstances. For example, if you have a bad credit record, a broker will be able to give you valuable advice on how to improve it and which products you can apply for with more chance of being approved.
In fact, a broker will be able to recommend deals that you’re more likely to be accepted for, removing the risk of applying for the wrong product on your own. This can help you avoid a rejection appearing on your credit record, which could have a negative impact on future applications.
Another point worth mentioning is that, while you may have access to exclusive direct deals through your provider of choice, a broker can often get their own exclusive deals from a variety of providers, giving you more options across the board from a greater number of lenders.
Also, from assistance completing paperwork to getting your documents in order, there is no substitute for the guidance and support a mortgage broker can provide you through the whole process. By going alone, you could find yourself lost if you aren’t already familiar with a mortgage application, but a good broker will always set you right.
Finally, it’s important to point out that a good mortgage broker is working for your benefit, not that of a bank or building society. Part of a broker’s job is to remain professional throughout the whole process, and they are strictly regulated by the Financial Conduct Authority (FCA). Plus, they want to keep you as a client, so it’s in their best interests to match you up with the right deal
Are mortgage brokers worth it?
One of the main reasons that people think twice about taking mortgage advice is that they don’t want to pay any extra fees. This is understandable, especially just before making such a huge financial commitment in taking out a mortgage, but it’s important to know that employing a mortgage broker can actually help you save money in the long-term.
The mortgage market can be surprisingly complex, where one product can seem to be the best value, but in actual fact another seemingly pricier deal works out better in the long run — just take a look at this example from the Mirror as evidence. A broker will take into account all the possible costs of potential deals and present them in a digestible way, allowing you to see which one is best.
In the many cases, any fee charged by a mortgage broker will be more than repaid by the savings that you will make from the mortgage deal they will find you. If a broker is going to charge a fee for their services, there’s no need to be put off by it, as you are investing in something you will benefit from in the future.
Lastly, one thing to bear in mind when looking for the right mortgage broker is whether they are linked to a bank or building society or not. There are some tied brokers who will only be able to offer you the products from one lender, so if you are looking for the a wide variety of lenders on the market, it’s probably better to look elsewhere.
Here at The Mortgage Genie, we work with a comprehensive panel of lenders to make sure you have the best chance of finding the right mortgage. We can access many lending institutions to ensure the most suitable mortgage choice possible choice for our clients, including hundreds of products which are not available on the high street. For a sample of just some of the mortgage deals we could find, you can take a look at our mortgage finder tool, where you can enter a few of your details and get and idea of the huge variety on offer.
How much do mortgage brokers charge?
There is no set fee for the services of a mortgage broker, and the costs incurred could depend on what type of product and how much work is required on your case.
As we’ve mentioned, a mortgage broker offers a service, so you may need to pay a fee at some point. There are two main ways in which a broker can be paid: by charging a one-off fee upfront or by earning commission from the lender once you’ve been approved (some brokers will charge upfront and still earn commission).
Many mortgage brokers will advertise themselves as being ‘fee-free’, as they are paid only through commission. Though this can be an eye-catching offer, it’s also worth considering those that charge a fee upfront, as you can rest assured that your broker will only make recommendations based on your best interests, rather than which product will net the most commission. Plus, if a broker who charges a fee finds you a better deal than one who doesn’t, the long-term savings are likely to outweigh this cost.
Here at The Mortgage Genie, we are big believers in transparency for our customers, and that’s why our initial consultation will always be free of charge. Once we’ve got a good idea on what your needs are and what type of product you will require, we will then be able to work out whether a fee is necessary. Our typical fee is £293, and will never be more than 1% of your mortgage amount. Any fee that we charge will always be upfront and agreed before you make your application.
Speaking to a mortgage broker
If you decide that getting advice from a mortgage broker is the right course of action, you can begin to think about speaking to one and getting the ball rolling.
In this section, we will provide advice about getting in touch with a mortgage broker and what to expect. We’ll also discuss some essential questions that you should ask a broker to ensure you’re getting a great service. Read on to find out how to get started.
When should I speak to a mortgage broker?
Ideally, you should speak to a mortgage broker as early as possible in the house-buying process. This is because you need to begin your mortgage application before you have started to seriously look at buying a property. Many people have lost out on their dream home because they have not had the finances in place to complete the deal.
If you want to remortgage, you should speak to a mortgage broker around three months before the switch date you have in mind. Most people look to remortgage as the introductory deal or minimum term on their existing product is coming to an end. Be sure to read our guide to remortgages to find out more.
What information will a mortgage broker need?
For your initial meeting with your broker, you will need to provide them with a few details and documents, so they can get a grasp of your personal circumstances and your financial situation. They will also provide evidence to the broker that you are in the position to apply for a mortgage.
Getting your documents in order is not just for your broker’s benefit: it will help you understand your own finances ahead of the meeting, too.
You will need:
- Bank statements for the last three months.
- Payslips for the last three months (if you are employed).
- Last two years of business accounts (if you are self-employed).
- Your most recent P60, the form that shows how much tax you paid in the last financial year (more information
- available on the government’s website).
- Proof of identity — passport or driver’s licence.
- Proof of address — your most recent utility bill.
How many mortgage brokers should I contact?
While you may be tempted to use more than one mortgage broker to get as many deals as possible to choose from, it may not be a good idea. Your broker will be able to do the best job possible for you when they’re able to sit down and really get to know about your needs and circumstances.
A good broker will always be on the lookout for the most suitable deal for you, and this can mean they will be in regular contact. If you have more than one advisor getting in touch, you may lose track of what offers are on the table, and which one offers the best value.
Plus, every time an application is made to a lender on your behalf, they will carry out a credit check, which will show up on future records. Banks and building societies can take lots of applications as a sign of financial instability, which could lead to you being rejected. This is much more likely to happen if you have more than one broker on the case who aren’t in communication with one another.
There’s also a chance that using multiple brokers will mean paying multiple fees.
How do I choose a mortgage broker?
Choosing a mortgage broker requires a little bit of research on your part. Finding a mortgage broker you can trust is an important step, as they will be responsible for getting you the most suitable mortgage for your home, as well as handling a lot of the application process. You should consider the following when starting your search.
Face-to-face or over the phone?
Think about what kind of experience you would prefer: do you want to sit down with someone face-to-face or are you happy to speak to someone remotely over the phone? While neither is superior to the other, the one that you prefer will probably come down to your own needs and lifestyle. For example, if you have a busy working schedule, you may prefer a phone-based service for its convenience. But, if you’d like a more personal touch, you’re best off looking for a broker in your local area that you can meet with.
Here at The Mortgage Genie, we offer both a nationwide phone service and a local face-to-face service. And, our advisors are available 7 days a week, so you can always arrange a consultation at a convenient time. Get in touch if you’d like to find out more.
Look for customer feedback
Before you contact a broker, you should try to to get some idea of what experience other customers have had with them.
Many brokers will also have customer reviews available on their site. Be sure to look at those from a verified reviewing service like Trustpilot or Feefo over those published by the broker themselves. Here at The Mortgage Genie we use Feefo to provide genuine customer reviews — take a look at our feedback here.
Once you’ve found to a mortgage broker you think will deliver, it’s time to arrange a meeting with them either in-person or over the phone. In the next section, we will take a look at some of the questions you should look to ask them.
Are they qualified?
You should make sure that any potential mortgage provider is sufficiently qualified to offer you the advice you need. To practise as a mortgage broker in the UK, you need to pass the Certificate in Mortgage Advice and Practice (CeMAP), so this needs to be the certification that you’re on the lookout for. This is a qualification that is recognised by the Financial Conduct Authority, who regulate the industry.
Here at The Mortgage Genie, all of our advisors are fully qualified to offer you the very best advice on your mortgage. Not only that, but they have years of experience in the industry helping our clients find a great deal on their dream home.
Are they regulated by the Financial Conduct Authority?
The Financial Conduct Authorityis the body that is responsible for overseeing the conduct of mortgage brokers in the UK, so it’s mandatory that any broker is registered and regulated by them. By finding out, not only can you be sure that you will be receiving a quality of service in line with the Financial Conduct Authority standards, but you will also have access to their support should there be any problems. You can check whether a mortgage broker is registered with the Financial Conduct Authority by searching their register.
The Mortgage Genie Limited is fully authorised and regulated by the Financial Conduct Authority for mortgage and non-investment insurance advice (reference number: 754691).
What to ask a mortgage broker
When you meet or speak to a mortgage broker for the first time, it’s a good idea to take a list of essential questions to ask them that will verify their skill and authenticity, as well as giving you a clearer picture of what their service will provide for you.
We’ve selected some of the most important questions you should think about asking your mortgage broker below, so be sure to take them with you to your first meeting.
Are you tied to any bank or building society?
As we’ve mentioned, there are some mortgage brokers who are tied to a particular bank or building society, limiting the range of products they can offer you and the diversity of deals you can access. By establishing early on whether an advisor is only able to offer one lender’s deals, you can quickly spot those that will only give you a small slice of the market.
At The Mortgage Genie, we have access to a comprehensive lender panel making it more likely that we can find a deal suited to you. We aren’t tethered to one lender.
How will you get payment?
You should ask how a mortgage broker will be paid for their services: it will either be an upfront fee from you, commission from the lender, or a combination of both. Many people prefer to go with a mortgage broker who charges a fee for their services, as they can be confident that they won’t be swayed by the size of any commission.
We charge an upfront fee here at The Mortgage Genie, but only after we’ve had a free initial consultation with you to determine what your needs are. Any fee that we charge will never be over 1% of your mortgage amount.
How long will the process take?
Depending on your own personal needs, you may wish to find out how long a mortgage broker will take to complete the research and application process. If you have a deadline in mind, it’s always worth mentioning early on to see if the broker can provide a fast-track service to ensure you have your finances in place on time.
Do you offer insurance products?
Most mortgage providers require you to have certain insurance in place before finalising any deal, so it’s worth finding out whether your mortgage broker can also provide advice and recommendations in this area, too. By going through a broker for insurance, you can confirm that the right cover will be in place for completion, as well as saving yourself a lot of time researching and applying elsewhere. Your mortgage advisor will have taken the time to get to know your circumstances, so they will be best placed to recommend the most suitable insurance for you.
If you’re looking for insurance alongside your mortgage, The Mortgage Genie can certainly help. We can help you find the most suitable cover across a variety of products, including mortgage protection, life insurance, critical illness cover, income protection, and home insurance.
Why is this the mortgage product for me?
When a mortgage provider recommends a product for you, don’t be afraid to ask them why they think that this particular deal is right for you. A good broker will be able to break the details of the product down for you and explain why this would be a good match. This way, you can always be sure that you will have a clear picture of your options.
At The Mortgage Genie, we have a great track record in finding the right product for our clients when they are buying a property. No matter if you’re a first-time buyer, purchasing a Help to Buy or new-build home, or even looking for an adverse-credit mortgage, we can provide tailored advice.
How can you help me in the future?
For many people, getting the right mortgage for their home is not the end of their relationship with their mortgage broker. Even though your deal is the right match to begin with, you may want to review it periodically to make sure that it continues to offer good value. If a better option becomes available, a good broker will be more than happy to help you review your options and find an alternative. Plus, if you ever decide to move home, buy a second home, or purchase a buy-to-let property, your advisor should be able to help.
Here at The Mortgage Genie, our team is highly experienced in all types of mortgage brokerage, so we will be able to assist beyond the purchase of your home. Whether you wish to move, purchase a buy-to-let, remortgage, or something else in the future, we can help you achieve your goals.
We hope this guide has helped you to understand what a mortgage broker can do and if this type of service can benefit your property purchase. Looking to find out more about the industry? It’s worth taking a look at our other mortgage guides, as they’re packed full of useful information
If you have any questions about this guide, feel free to get in touch with us. Don’t forget that we can assist you with any of your mortgage or insurance needs. We also have a great range of mortgage calculators that can help you to work out the finer details of your application.
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