Something I often see on social media is someone asking for mortgage advisor recommendation, only to be met with responses such as “Don’t use a mortgage advisor, do it yourself and you will get a better deal”. Or “Why do you need a broker? Just go to your bank.”
I have to stop myself replying to these people. But the fact is they probably don’t know the benefits of using a broker. With 80% of bank business coming from brokers, it’s clear that a majority believe using the a mortgage broker outweighs the benefits of finding a mortgage solo.
The truth is, there’s nothing stopping you going directly to your bank. The problem is you won’t have access to the 80-100 lenders that mortgage brokers do. Especially if your broker is whole of market like us.
Out of these 80-100, there are probably around 15-20 high street lenders who fight for the top spot in terms of being the best price.
Knowing this, it’s highly improbable that your bank will offer the cheapest rate on the market. If they do, you got lucky. A broker can search the market and find you the cheapest deal to fit your circumstances.
And while Nationwide, for example, might be the cheapest on Monday, it could be HSBC Tuesday and then Coventry Building Society on Wednesday, etc.
There are several reasons you need a mortgage broker as a first time buyer.
1. Appointment times
Often when you go direct to a bank, you have to wait days (at best), if not weeks to secure an initial appointment.
A good broker can book you in for the initial appointment without delay. Sometimes we’ll take your details straight away and have a Mortgage in Principle (MIP) back within 24 hours. Assuming your paperwork and documents are in order, a good broker will secure a MIP for you ASAP – meaning you can progress knowing your affordability.
2. Opening hours
Banks have rigid opening hours and if you miss them, your home buying process is delayed. We are available outside of these to help. In fact, I always answer my phone anytime or place. If I’m busy, I’ll make sure to call you back.
3. Advice for your circumstances
Going direct to a bank means you won’t receive advice. In fact, the banks can no longer give advice. Quiet often you have to pick your own product, we do this for you and advise not just the most suitable bank but the cheapest product fitting your circumstances. The choice you face alone can be overwhelming. We do this day in day out so its second nature to us.
4. On going support and advice throughout the process
We manage the mortgage, when the fixed rate is coming to an end we search the market to make sure you are on the cheapest rate for your next term. Over the life of the mortgage this can save thousands. On the other hand, your bank will simply just offer you the rate they have, regardless of better products available elsewhere.
5. Life insurance
Many banks offer this, but again, they’re only one provider. We are whole of market and, again, can offer life insurance advice in this area – ensuring you not only the cheapest deal but also the most suitable level of cover for your circumstances.
6. Market knowledge
We’re searching for mortgage products on behalf of clients day in day out. We know what lenders like and what they don’t like. We also know when lenders are dropping rates and raising them. It could be, for example, that we know HSBC are dropping their rates so we’ll hold your application to get you a lower rate.
Conversely if they are rising, we will act quickly to get you a better rate secured. The general public wont have this information. And by the time it’s reported on news outlets, it’s too late. Not using a mortgage broker means you’re looking for a deal with no market knowledge.
7. Access to more lenders
Not every high street lender has a branch or presence that allows clients to access them directly.
This is a massive advantage to using a mortgage broker. Quite often I send clients deals from Bank of Ireland, Coventry BS, CO-OP, Mpowered Mortgages, Digital Mortgages, Principality BS, Skipton BS, Virgin, Clydesdale and West Brom, to name a few. They’re some of the best value lenders I’ve come across. But most people wouldn’t think of going to these because they have never heard of them. Some don’t even appear on comparison sites.
8. Comparison sites
I sometimes get clients sending me details of a ‘cheaper deal’ they’ve seen on a comparison site.
As before, price only makes up one part of the puzzle. Sometimes deals appear on a comparison site from bank like Danska Bank, for example, who are Northern Ireland only. What commonly happens in these situations is once we explain why we didn’t chose the lender they sent us, we end up at the original agreed mortgage. The client has their confidence restored that we selected them the best deal. Comparison sites are often simply clickbait.
9. Fee free
If you chose a mortgage broker like us that is fee free, it doesn’t make much sense to go at it alone. There is no catch, the prices are the same if not better, there’s no such thing as better deals for direct customers.
10. Application process
I have spoken to clients who apply through the bank. It’s a long process. While we still have many regulatory procedures we go through with clients, they immediately notice how easy it is for them when they use us. We just need information, documents, and your questions. That’s it. We keep it simple – you provide the documents, we fill in the tedious forms. It’s as simple as that.
11. Prices
We often get exclusive deals with many high street banks like Natwest, Halifax, Coventry and Santander to name a few. This can mean lower rates or other incentives like cashback. You won’t get these going direct.
The question isn’t do I need a broker or can I apply for a mortgage myself. The question surely is can you afford not to use a mortgage broker?