Why Use A Broker?admin June 7th, 2011
For many the thought of arranging a mortgage is a daunting task. With the wealth of information available online, not to mention your bank on the high street, where do you start?
A mortgage broker might be a good place. However, most people view brokers as the grey area between them and a mortgage company. So what do they do, and why use their services?
Mortgage brokers (or intermediaries as they are also known) are able to search the market and find the best mortgage deal for your circumstances. Instead of passing your details to every bank or lender, you can submit your information to one broker and let them search for you. This can save you both time and money. A good broker will take your personal information, offer you advice regarding your situation and form a recommendation based on the details you have provided them with. The result, a mortgage product that’s tailored to your needs.
In the current climate mortgage lending is restricted and it can be a task to get a mortgage at all. For those who don’t use a broker the reality is hours spent speaking to banks, lenders, and call centres – not to mention ever changing mortgage criteria.
A good broker will guide you through the maze of mortgages, find you a suitable product and complete all the paper work. The majority of brokers offer a bespoke service, so you’ll hopefully get looked after from application through to completion.
To make it easier for you to choose a good broker we’ve put together some criteria we think all brokers should deliver as standard:
- Are they whole of market? Some brokers may only have a panel of lenders they can approach on your behalf, this can restrict your ability to get the best deal.
- Do they offer free impartial advice? It has been know for brokers to charge for advice, we believe that all advice should be free as standard.
- What fee’s do they charge? Like any professional service brokers may charge you an administration fee for arranging your mortgage. This is not a problem however, don’t pay over the odds make sure you understand what you are paying for. In the case they can’t arrange the mortgage you require ensure you’re entitled to a refund.
- Do they offer flexible appointments? Some brokers may be restrictive in when they can speak to you, or request you visit them at their offices. A modern broker should offer flexible appointment times and arrange a meeting to suit you, after all you’re paying for the service.
- Through to completion? Its important your broker is available from the moment you apply for a mortgage through to completion. There are many parties involved when buying a house, complications can occur at any time. Your broker should be on hand to help out if problems arise when purchasing your home.
- Are they reliable? When selecting a mortgage broker it’s important you get a first rate service. Ask to see testimonials and understand how they work. Being left chasing and asking questions about your mortgage is never a good place to be when you’re trying to buy a house.
- Do they offer a free insurance advice service? It’s important when arranging your mortgage to have appropriate protection in place for both you and your home. A good broker will ensure you have adequate protection in place should the worst happen.
Figures offer by the Council of Mortgage lenders go to show the importance of mortgage brokers:
Brokers accounted for 63% of first-time buyer mortgages, 60% of remortgage loans and 53% of home mover loans in the first quarter of 2011. This compares to 63%, 56% and 52% of first-time buyer, remortgage and home mover loans during the last quarter of 2010.
Peter Williams, executive director of the Intermediary Mortgage Lenders Association, says: “Intermediaries play an important role in the UK mortgage market and it is encouraging that despite massive change in the market they still account for the most significant proportion of mortgage business. Intermediaries excel at helping consumers find the right product for their needs, adding value to both borrowers and mortgage lenders.
It’s always important to conduct your own research before applying for a mortgage, but after that it might be worth speaking to a broker to see how they can help.