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By Pete Mugleston | Mortgage Advisor

Pete has been a mortgage advisor for over 10 years, and is regularly cited in both trade and national press.

Updated: 15th June 2020*

If you’re applying for a mortgage, you would typically have two choices: go direct to a bank or building society to apply for the finance you need, or use a mortgage broker. Here, we’ve compared both options to help you make the right decision.

The following topics are covered below…

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Should I use a mortgage broker or go direct to a bank?

Use a mortgage broker if you want access to the entire market or have a more complicated financial situation which may require a specialist lender who doesn’t deal directly with the public. Use a bank if you already have experience of how the mortgage market works, a healthy deposit and are confident you can’t get a better deal elsewhere.

There are many reasons why people use a mortgage broker instead of going directly to a bank, building society or another type of lender, including…

  • Brokers can give you access to a wider range of products
  • They can negotiate more favourable deals on your behalf
  • They can help you with the paperwork
  • They can offer bespoke advice and specialist expertise
  • A broker could be the difference between mortgage approval and refusal if you fall into a ‘higher risk’ category such as bad credit or self-employed

The advisors we work with are whole-of-market, which means they have access to mortgage lenders across the UK and find the best rates and deals that you qualify for. Make an enquiry and we’ll introduce you to one of them for a free, no-obligation chat.

Do mortgage advisors get better rates for customers?

Yes, they can potentially get you more favourable interest rates than the ones you’d end up with if you went directly to a mortgage lender. This is because going straight to a lender without seeking professional advice first means you would only have access to their products and risk missing out on a more suitable deal available elsewhere.

This is the main reason why you’re more likely to end up with a favourable interest rate if you apply through one of the advisors we work with. They have whole-of-market access so all of the best deals that you qualify for will be within reach if you decide to work with them.

Moreover, some mortgage advisors can negotiate a more favourable deal than you would otherwise get with a specific lender and may have access to broker-exclusive deals.

If you fall into a category that mortgage providers consider ‘higher risk’ such as bad credit, self-employed, expat, retired or low income, a specialist broker can make all the difference.

Many mortgage lenders either charge higher interest rates to customers in these categories or turn them away altogether, but a broker with the right expertise can match you with the provider who is best positioned to lend on the most favourable terms.

Is it cheaper using a broker or going direct to a bank?

The most important thing to keep in mind when considering this question is the overall amount you will pay for your mortgage if you apply through a broker. While most mortgage brokers charge fees, you could save a significant amount in the long run if they find you a better mortgage deal than what you’d find yourself, and the likelihood is that they will.

On the flip side, those who go direct to a bank, building society or credit union might save a relatively small amount in fees in the short term, but they might be running the risk of being out of pocket overall since there’s no guarantee they’d end up with the best deal.

The brokers we work with operate on a success-only model. You won’t be charged a penny if they fail to get you a mortgage and will refund any upfront fees in this unlikely scenario.

What’s more, they won’t charge you for an initial consultation about your mortgage needs and personal circumstances, and will offer total transparency on the fees involved.

Should I use a mortgage broker or do my own research online?

Most experts would recommend using a mortgage broker to compare the market rather than carrying out your own research online. Internet rates tables and comparison tools can be useful to get a general overview of the deals on offer, but they aren’t bespoke to you, are rarely whole-of-market and are known to promote sponsored products.

We only work with brokers who can compare deals across the whole of the market and source mortgages that are bespoke to your needs and circumstances.

Should I use a mortgage broker or an insurance agent?

Mortgage brokers can recommend and negotiate many of the protection insurance products you’re likely to need when buying a property, including life insurance, home insurance and landlord insurance (for those in the market for a buy-to-let mortgage).

Using a broker for protection insurance products has many of the same advantages as it would for mortgages, namely whole-of-market access and bespoke advice.

For information about types of insurance that fall outside of the protection class and access to financial advisors who specialise in them, see our sister service Online Money Advisor.

Do I need a mortgage broker or a financial advisor?

That depends on what you need advice on. If you need mortgage advice, the whole-of-market mortgage brokers we work with offer a five-star service and can also arrange deals for related financial products such as bridging loans and protection insurance.

Independent financial advisors can give you advice on a wider range of products, which may include pensions, investments and business loans. Some of them are qualified to provide mortgage advice, as well as arrange deals for the aforementioned products.

We also work with independent financial advisors and will match you with one if that’s the best fit for your needs and circumstances. Make an enquiry to get started.

Speak to a mortgage broker

Applying for a mortgage through a mortgage broker is a better alternative to going straight to a bank building society or credit union. The advisors we work with can recommend products from across the market, offer you bespoke advice and help you with your application.

Call 0808 189 2301 or make an enquiry and we’ll match you with a broker who could potentially save you time, money and possible disappointment. We won’t charge a fee for introducing you and there’s no obligation to act on their advice.

Updated: 15th June 2020
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FCA disclaimer

*Based on our research, the content contained in this article is accurate as of most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The info on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs. Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.