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Mortgage Broker Vs. Going to the Bank for Your Mortgage

See how using a mortgage broker could increase your chances of approval, and help secure your mortgage with the best deal

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Pete Mugleston

Author: Pete Mugleston - Mortgage Advisor, MD

Updated: May 16, 2022

When you’re applying for a mortgage, most people either go directly to the bank or use a mortgage broker to do all of the legwork for them. If you’re wondering which of these two options is the best one for you, you’ve come to the right place.

In this guide, we’ll compare both approaches and explain in detail why using the right mortgage broker is always a safer bet than approaching a lender yourself.

Should you use a mortgage broker or go directly to the bank?

Use a mortgage broker if you want access to the entire market or have a more complex financial situation, such as a history of bad credit or ‘non-standard’ income. Circumstances like these often call for a specialist mortgage lender, and you’ll need a broker to find the right one for you.

Going directly to the bank for a mortgage is only recommended if you’re a financial expert who knows the mortgage market inside out, and can say with absolute certainty that their bank is offering the best deal available. Otherwise, you’re limiting yourself to just one set of products.

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 help you optimise your credit report and prepare for a mortgage application
  • Save you time by shopping around and negotiating better deals for you
  • Recommend the right insurance to complement your mortgage deal
  • Help with all of your paperwork
  • They can offer bespoke advice and specialist expertise
  • They can help you get approved for a mortgage if you fall into a ‘higher risk’ lending category, such as bad credit or you’re looking for a self-employed mortgage
  • Brokers can help you avoid unnecessary marks on your credit report by making sure you’re matched with the right mortgage lender, first time
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We know everyone's circumstances are different, that's why we work with mortgage brokers who are experts in all different mortgage subjects.

Ask us a question and we'll get the best expert to help.

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Can a mortgage broker get you a better deal?

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 better 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.

Broker-exclusive deals

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.

Remember, too, that there are some lenders out there that do not deal with the public directly and promote their products exclusively through brokers.

If you fall into a category that mortgage providers consider ‘higher risk’ such as bad credit, a self-employed mortgage, expat, retired or you’re looking for a mortgage with low income, a specialist broker can make all the difference  in terms of improving your prospects.

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 more expensive to use a mortgage broker?

Not necessarily. Some charge a fee, but the most important thing to keep in mind is the overall amount you will pay for your mortgage if you apply through a broker. While most mortgage brokers will charge you for their time, 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 directly 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.

Why you should use an Online Mortgage Advisor broker

We’ve already established that using a mortgage broker has many advantages over going straight to the bank, but finding the right broker is just as important. If you were to choose a mortgage advisor at random, there’s no guarantee that their expertise will line up with your needs and circumstances – but if you use our broker-matching service, this won’t be an issue.

Our broker-matching service quickly assesses your requirements and personal information to pair you up with your ideal mortgage advisor, somebody we’ve trained, vetted, and handpicked because of their track record helping customers just like you get a great mortgage deal.

Below we’ve outlined the benefits of using an Online Mortgage Advisor broker compared to picking an advisor at random or going to a mortgage lender directly…

Going direct to Bank

  • Cross
    Access to limited products
  • Cross
    Limited advice on only in-house products
  • Check
    No brokers fees to pay
  • Question Mark
    You could miss out on better deals elsewhere
  • Question Mark
    Can be quicker than using a broker, but the risk of rejection and paying more in interest is higher
  • Cross
    You’d need to seek your own clarification about which qualifications your bank’s in-house staff have

Finding your own Mortgage broker

  • Question Mark
    Usually whole-of-market, but not always
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    Impartial advice
  • Question Mark
    Potential broker fees, but you could save money by paying less interest in the long run
  • Question Mark
    Not as quick as going straight to the bank since you’d have to take the time to find the right mortgage broker for you
  • Question Mark
    Likely CeMAP or equivalent qualified, but advisable to check credentials
Our Service

Using Online Mortgage Advisor

  • Check
    Guaranteed to be whole-of-market
  • Check
    Maximise your chance of approval with our Mortgage-Approval Guarantee
  • Check
    Impartial advice from an expert who specialises in your circumstance
  • Check
    You’ll only pay fees in accordance with our fair-fee policy
  • Check
    Save time by letting us find your perfect broker
  • Check
    Save money in the long run by getting a better mortgage deal
  • Check
    Guaranteed to hold an industry-standard qualification such as CeMAP or Cert MA, and has also passed a LIBF-accredited training course with us

Common misconceptions about mortgage brokers

Below we’ve tackled some of the most common misconceptions about mortgage brokers and clarified exactly why they’re false…

  1. Mortgage brokers cost extra: Some people think they’re saving money by going directly to the bank, but bear in mind that a broker is likely to secure a better deal for you, and that could mean ending up in pocket overall, even with broker fees factored in.
  2. Going to the bank is the quickest option: Yes, it might save you a small amount of time at the start of the process, but things could quickly become drawn out if the bank declines you and you’re scrambling around trying to figure out where to turn for help. Brokers can also save you time in the long run by helping you with your paperwork.
  3. My bank will reward my loyalty: Many people assume that the lender they bank with will reward their loyalty if they choose to apply for their mortgage with them, but this isn’t necessarily true. In fact, bank loyalty is one of the main reasons why people don’t end up with the best deal on their mortgage, because there’s zero guarantee the product range your bank is offering includes the perfect mortgage for your requirements.
  4. Going to the bank is the easiest option: Again, not necessarily as a mortgage broker can take most of the stress out of the process. They will offer you bespoke advice throughout, guide you through to completion and help you with the paperwork.
  5. You don’t need a broker to remortgage: It might not be a requirement, but it’s a good idea to have a broker search the entire market for you before you remortgage. There’s no guarantee the best remortgage deal for you is with your current lender, or even one you’ve heard of yourself or could find through a quick Google search.

Get matched with the right mortgage broker today

Rather than going directly to the bank for your mortgage or choosing a mortgage advisor at random, the best course of action is to have the right mortgage broker handpicked for you.

By using our free broker-matching service, you can rest assured that the advisor you’re introduced to will be the perfect fit for your needs and circumstances. They’ll have a strong track record helping customers just like you and specialise in cases like yours.

Call 0808 189 2301 or make an enquiry and we’ll set up a free, no-obligation chat between you and your ideal broker today. Speaking to them before you apply instead of rushing straight to the bank could help you save time, money and unwanted marks on your credit report.

FAQs

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 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.

Ask us a question

We know everyone's circumstances are different, that's why we work with mortgage brokers who are experts in all different mortgage subjects.

Ask us a question and we'll get the best expert to help.

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About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for OMA of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of the 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 information 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.

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