What Is a Mortgage Broker?

A mortgage broker is a qualified financial professional who helps borrowers find and secure the best mortgage deals for their circumstances. Acting as an intermediary between borrowers and lenders, a broker works with banks, building societies, and specialist mortgage providers to find loans that suit a buyer’s income, credit history, and property goals.

Unlike going directly to a bank, a mortgage broker has access to a wide range of lenders, including some that don’t offer mortgages directly to the public. They provide expert advice, handle paperwork, and negotiate terms, making the mortgage process smoother, faster, and potentially more cost-effective.

In this guide, we’ll explain how mortgage brokers work, their benefits, and how they compare to going directly to a lender – helping you decide whether using a broker is the right choice for you.

Why use a mortgage broker?

One of the best reasons to use a mortgage broker is that they can guide you through every stage of the mortgage process. If you’re a first-time buyer, for example, having a broker with you every step of the way will help, especially if you’re unfamiliar with how applying for a mortgage works.

When applying for a mortgage, you have two options: you can go directly to a lender or use a broker. While it’s possible to secure a mortgage on your own, a broker can simplify the process, save you time, and potentially find you a better deal. However, using a broker isn’t right for everyone.

Below, we’ll explore the advantages and disadvantages of working with a mortgage broker.

Pros of using a broker

Access to more lenders & better deals

• Brokers work with a wide range of lenders, including specialist mortgage providers that aren’t available to the public
• They can compare rates across multiple lenders, potentially finding you a better mortgage deal than what you’d get on your own

Expert guidance & mortgage advice

• Mortgage brokers understand lender criteria and can match you with lenders most likely to approve your application
• They can explain complex mortgage terms, making the process less stressful and easier to navigate

Saves you time & effort

• Instead of contacting multiple lenders yourself, a broker handles the research and application process for you
• They help organize paperwork, reducing the risk of delays or errors

Help for complex or challenging cases

• If you have bad credit, are self-employed, or need a specialist mortgage, brokers can find lenders with more flexible criteria
• They can assist with mortgage applications that have been previously declined

Negotiation power

• Brokers negotiate with lenders to secure better interest rates and mortgage terms
• Some brokers have access to exclusive deals that aren’t advertised to the public

Support from start to finish

• Brokers guide you through the entire mortgage process, from application to approval, ensuring a smooth experience

Cons of using a broker

Broker fees

• Some brokers charge fees for their services, which may be an upfront cost or a commission added to your mortgage
• Not all brokers charge fees—some earn commission from the lender instead

Not all brokers cover the whole market

• While brokers offer access to more lenders, some only work with a limited panel instead of the entire mortgage market
• Always ask whether a broker is “whole-of-market” before choosing one, and ask how many lenders they work with and if they have a preference for certain ones

Potential conflicts of interest

• Some brokers may favour lenders who pay higher commission, rather than the best deal for you.
• It’s important to use a regulated, independent broker who prioritises your needs

How does a mortgage broker get paid?

Mortgage brokers provide a valuable service by helping borrowers find the right mortgage deal, but how do they make money? Brokers are typically paid in one of two ways: commission from lenders or fees charged to clients. Some brokers may use a combination of both.

Below, we explain how mortgage brokers earn their income and what you need to know before working with one.

Lender commission (Procuration fee)

Many mortgage brokers do not charge their clients directly. Instead, they earn money through a commission paid by the lender once a mortgage is approved.

How it works:

• When a broker arranges a mortgage, the lender pays them a percentage of the loan amount as a procuration fee
• This commission typically ranges from 0.3% to 0.5% of the mortgage value
• For example, on a £200,000 mortgage, a broker earning 0.4% commission would receive £800

Pros for borrowers:

• No direct cost – you don’t pay the broker out-of-pocket
• Incentivizes brokers to find competitive mortgage deals

Broker fees (Client-funded fees)

Some mortgage brokers charge a direct fee for their services, either upfront or upon mortgage approval.

How it works:

• Fees can be fixed (e.g., £300 – £1,000) or a percentage of the mortgage amount (typically 0.3% to 1%)
• Some brokers charge a non-refundable fee upfront, while others only charge upon securing the mortgage
• The amount can vary based on the complexity of your application, your financial situation, and the level of service provided

Pros for borrowers:

• You’re paying for independent advice, so the broker is more likely to act in your best interest
• May be more suitable for complex cases (e.g., bad credit, self-employed applicants, or high loan-to-value mortgages)

Hybrid payment (Combination of fees & commission)

Some brokers charge both a client fee and receive lender commission, particularly for specialist mortgage cases.

When might you pay both?

• If you need a bad credit mortgage, self-employed mortgage, or high LTV mortgage
• If the broker is securing a complex mortgage with a specialist lender
• When the broker provides additional services, such as detailed financial planning

What documents will a mortgage broker ask for?

When applying for a mortgage, a mortgage broker will need several key documents to assess your financial situation and find the best mortgage deal for you. Having these documents ready can speed up the application process and improve your chances of approval.

Proof of identity & address

To verify your identity and comply with anti-money laundering regulations, you’ll need to provide:

• Valid photo ID: Passport or driving licence
• Proof of address: Recent utility bill, council tax bill, or bank statement (dated within the last 3 months)

Tip: If the address on your ID doesn’t match your utility bill, update it before applying.

Proof of income

Lenders need to confirm that you earn enough to afford the mortgage repayments. The documents required to prove your income depend on your employment status.

For employed applicants:

• 3 months payslips (or 12 weeks if paid weekly)
• P60 form (summary of annual earnings & tax)
• Employment contract (if you’ve recently started a new job)

For self-employed applicants:

• SA302 tax calculations (last 2-3 years, from HMRC)
• Tax Year Overviews (last 2-3 years, showing tax paid)
• Business accounts (prepared by an accountant)

Tip: Some lenders require a chartered or certified accountant to prepare self-employed accounts.

Bank statements

Lenders typically ask for the last 3-6 months of bank statements to assess:

• Income consistency: To confirm earnings match your payslips
• Spending habits: To ensure you can manage mortgage repayments
• Debt repayments: To check if you have loans or credit commitments

Tip: Avoid large, unexplained transactions before applying, as underwriters may request further details.

Proof of deposit

If you’re using savings, a gifted deposit, or government schemes, you’ll need to provide the following as proof of deposit:

• Savings account statements showing the deposit funds
• Gifted deposit letter (if receiving financial help from family)
• Shared Ownership documentation or similar (if using a government scheme)

Tip: If your deposit is a gift, lenders may require proof that it is non-repayable.

Credit report

Some brokers may ask you to download your credit report to check your financial history and identify any red flags.

Tip: If you have bad credit, a broker can help find lenders with more flexible criteria.

Details of current financial commitments

Lenders will assess your existing financial obligations, including:

• Credit card balances & loan statements
• Car finance agreements
• Child maintenance payments (if applicable)
• Other mortgages or buy-to-let properties (if you own additional properties)

Tip: Paying off small debts before applying can improve affordability calculations.

Should I use a mortgage broker?

Yes, we recommend you do, of course! The exception to this rule is when you have no equity in your property. If you are looking to remortgage and your loan-to-value (LTV) is 100%+, then your only option is to go back to your current lender and see what product transfer deals they have available.

Questions to ask a mortgage broker

If you’re not using us, make sure you ask your broker some important questions:

• Do they have access to the whole market? Then re-ask: Is that the actual whole market or just a panel? Will they offer you a range of direct deals as well as broker deals?
• What do they charge?
• Are you obliged to take any insurance products with them?
• How busy are they currently, and will they have the time to prioritise your application?

Get matched with the right mortgage broker today

If you’re ready to start with your ideal mortgage broker, the quickest and simplest way is to use our broker-matching service.

Our service will swiftly assess your needs and circumstances to pair you with the mortgage broker best placed to help you secure a great mortgage deal. This advisor will be one we’ve personally vetted, trained, and handpicked specifically for you.

Call 0330 818 7026 or make an enquiry to get started with your ideal mortgage broker today.