If you are about to start your home buying journey, you are probably considering getting mortgage advice.
We often get asked are all mortgage brokers the same?
If you’d asked us this three years ago, we’d have confidently said yes. But since then, we’ve met over 100 mortgage advisers, and now we know that they are definitely not all the same!
Choosing a mortgage broker is an important decision. At Move Engine, we work with many different mortgage brokers who have all been through our vetting process, which has allowed us to come up with the criteria below to help make your decision easier.
If you want to be confident that your mortgage broker is giving you the best possible advice, then it’s important to understand what you should expect from them and how they can differ.
Let’s start with the basics:
Where do I find a mortgage broker?
Finding a mortgage broker is not difficult, finding the right one is harder, but there are several places you can start your search:
- Estate agents and developers will gladly recommend you, but they may get paid for passing you on. Referral fees are not unusual, but if they seem reluctant to share the details with you, it might be more about the money than matching you with the right adviser.
- Recommendations from friends and family are a good start – just remember that their situation may differ from yours, so check the other criteria we share below too before feeling pressured into using them.
- Our mortgage adviser matching service can help too – We always try to find a mortgage adviser experienced in cases like yours. After all, we are all unique and have our own needs and questions to be answered.
- In banks or building societies – just be aware that usually they can only offer their own mortgage products, so you may not get the best deal unless you shop around.
- Online brokers – if your case is simple and you know the type and term of mortgage you want, then an online broker can compare deals for you and they are often free.
Access to deals – An important factor when choosing a mortgage broker.
There are many mortgage deals available, so how do you know that you’re getting the best advice and the best possible deal?
It may surprise you to hear that there are actually hundreds of mortgage lenders out there and several thousand different mortgage products to compare.
One thing that we were surprised to learn is that some mortgage brokers don’t all have access to all lenders and deals.
Some will only recommend mortgages from selected lenders that they work with – limiting your choices.
Ideally, you want a broker that has access to the ‘whole of the market’.
A jargon word meaning they work with all lenders so they can find and recommend the best deal for you.
But it’s also worth noting that even these brokers may not have access to every possible deal.
Some lenders offer ‘direct-only’ mortgages which you can only get if you apply without a broker.
Your adviser doesn’t have to make you aware of these, but it is worth asking whether one of these deals could be cheaper for you and some we know will let you know this even if it means missing out on a fee.
Make sure you ask the question about how many lenders they work with before picking a broker otherwise you might miss out on the best deal for you.
Understanding your situation
The best mortgage broker will be one that has experience of helping people with similar circumstances to you.
Many first-time buyers come to us because they have recently changed jobs or are planning to shortly, or they might have only recently cleared a credit issue, or they might be self-employed or a contractor and are worried about when they can apply for a mortgage.
Whatever your specific situation, you want a mortgage adviser that has dealt with cases like yours and knows which lenders are most likely to approve you.
This is because each lender has their own set of criteria for determining who they like to lend to.
An experienced broker dealing with similar cases to yours will be able to know who is best to help you get approved.
How are you planning to buy
If you want to buy through a scheme, then it could influence your choice of broker.
Again some lenders like schemes like help to buy and others don’t. Some like shared ownership and others don’t. Some don’t mind quirky properties or new builds and others do.
It can all be a bit of a minefield which is why finding a broker that regularly deals with first-time buyers and the scheme you are planning to use can really help.
Big or small
There are pros and cons to choosing a larger mortgage broker firm vs choosing the one person band mortgage broker in your town.
A large firm will have more consistent procedures and practices and probably almost always someone available to take your call.
Alternatively you may prefer to work with a smaller broker. They should provide a more personal service but could at times get busy, and it could be frustrating if they cannot deal with you as quickly as you would like.
Often there are no hard and fast rules here so it makes sense to keep your options open and go on the past reviews and overall service that they offer as well as how well you get on with them.
Again watch out for those brokers who work in house with estate agents, are they working for your best interests or the estate agent?
Sometimes you might be pressured into using an in house broker but know that it is up to you to choose and they legally can’t force you to use any broker.
Of course the amount you pay for a mortgage broker is important to you. With so many other moving costs to consider you want to get value for money.
We always recommend you choose your broker based on experience and service level as well as cost.
Many mortgage advisers charge a fee. Some work for free as most also get paid a commission by the mortgage lender.
As a guide, if your situation is fairly mainstream, then expect to pay no more than £500 (i.e. full-time employed, borrowing on a normal house within your limits).
Expect to pay a little more if your circumstances are complicated such as bad credit mortgages or other complications.
There is often more to the fee than just applying for the mortgage.
Sometimes it’s the ‘extras’ that make all the difference to how smoothly things go for you and this can justify paying a little more:
- Do they give you confidence? Do they explain things clearly? How available are they? After meeting them, do you feel clear about the next steps?
- Do they offer help and support for things like protection, wills and solicitor chasing? Do they use a platform to make sharing documents easy? Do they provide out of hours appointments?
- Do they have good reviews? Remember not to take them at face value and read into what people are saying about them. Was it “they got me a good deal”, or was it “they were fantastic, nothing was too much trouble, and they kept me updated every step of the way?”
- Are they FCA registered? Always check that your broker is authorised to give mortgage advice on the Financial Services Register.
- For us, one of the biggest factors is likeability and how well you get on together. The house buying process can be stressful, so you want to feel that ‘your team’ is doing their absolute best for you.
So, after taking all of this into consideration, how do you decide on a mortgage broker? It’s a tough choice right? But hopefully using the guide above will help you.
At the end of the day you want to be sure that they understand your situation and have a service level that suits you.
If you’re still in doubt, use our quick-fire questions to find out if a mortgage adviser is right for you:
- How many lenders do you have access to?
- Do you have experience in my situation?
- Are you FCA registered?
- What are your fees?
- Can you advise on other things?
- What hours do you work?
- Do I like working with them and trust their advice is clear and transparent
If you still need help finding a mortgage adviser that you can trust – we will gladly point you in the right direction. Use our First-Time Buyer Mortgage Adviser Matching Service to chat to us and get help to find a mortgage adviser that is right for you.
Disclaimer: The material provided on this site is for information purposes only and is not to be considered financial advice. It is to be used as a guide in the process of purchasing a home and attaining the finance needed to do so.
Your home is at risk if you do not keep up repayments on your mortgage.