What Does A Mortgage Broker Do?
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What Does A Mortgage Broker Do?
What does a mortgage broker do?
The mortgage process can be an overwhelming and daunting experience. The purpose of a mortgage broker is to help clients make informed decisions and manage the whole process, once we’ve made an appropriate recommendation. We’re the client’s representative to guide them and answer their questions.
What’s the difference between going to a mortgage broker versus your local high street lender?
Mortgage brokers have access to a comprehensive range of mortgage products, which include high-street lenders and specialists that are only available through brokers.
If you approach a high-street lender, they’re restricted to offering their own products alone, which is a considerable reduction in options for the consumer.
Also, mortgage brokers are passionate advocates for their clients’ interests. We’re not tied to a specific lender, while a bank branch is only representing the lender and their products.
That lender might not be offering certain products such as an offset mortgage, or interest only borrowing. They might not fund certain government schemes or new build schemes. By using a broker, you can increase your chances of getting the right advice for your needs, as we have access to a comprehensive range of lenders in the market.
A final point is that generally most mortgage brokers are small businesses. We’re not large, impersonal bureaucracies like high street banks. We offer a more personal service and ensure you’re not put through to call centres. We also recommend independent surveyors and protection specialists, which the high street banks can’t because they are restricted to their own products.
What services does a mortgage broker offer?
We support clients through a daunting process, starting with a comprehensive financial review, looking at your circumstances and taking time to understand your priorities. We then research the market for the most appropriate options based on those needs.
We would make a recommendation and, with your approval, we could then request documents to get you an Agreement in Principle. We look at your income, outgoings and credit file to decide which is the appropriate lender, and we then go to that lender who does a credit check and affordability assessment.
You can use that Agreement in Principle to show an estate agent that you are mortgage ready and able to put an offer on the property. Once you’ve found that fantastic property, we submit the mortgage application and manage the process up until completion.
We’ll liaise with your solicitor, estate agent or developer and surveyors as necessary. We can help a wide variety of clients from First Time Buyers, people looking to remortgage their home, buy a holiday home or become a landlord.
Once you’re a client, we always review your deal three months before it finishes. We want to make sure you avoid going on to the lender’s standard variable rate – which is the most expensive rate they offer. That’s all part of the process.
The final thing is that while we don’t advise on mortgage protection, we do refer clients to a specialist that does. This is vitally important. It’s great to get somebody into a property, but we want to make sure that they can stay in that property, whatever happens.
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We support clients through a daunting process, looking at your circumstances and taking time to understand your priorities. We then research the market for the most appropriate options based on those needs.
When should I see a mortgage broker? At what stage in that process?
It depends on your circumstances. If you have an existing mortgage, I would recommend speaking to a broker to discuss remortgage options around three months before the deal finishes.
With some lenders a mortgage offer lasts six months, but with others it’s only three months. So three months before your deal finishes, we can access the most comprehensive range of lenders. It also gives us enough time to gather documents, complete research, make recommendations, submit applications and complete the conveyancing process.
It allows us to reserve a new rate before the current rate expires.
If you’re looking to purchase a new property I strongly believe it’s never too early to speak to a mortgage broker. Have an initial discussion to get an idea on your borrowing potential – which is sometimes called affordability. We can look at any issues that might arise.
The last thing you want is to find your dream home, then speak to an advisor and find you can’t borrow what you need to.
When clients do their research, everybody’s got an opinion, including your mate down the pub. Unfortunately, a lot of the time that can scare a client off, or do the opposite and make them think that they would be eligible for a great deal because their friend’s profile is similar to theirs. But no one is ever the same as someone else.
Does it cost for an initial consultation with you?
We don’t charge for an initial consultation or any follow up appointments to complete market research, make a recommendation, complete an agreement in principle or submit a mortgage application. We only charge a broker fee, which is currently £499, once we’ve secured your mortgage rate, the lender’s approved your application and the mortgage offer has been issued.
We consider this success fee – as we only want happy clients who have achieved what we promised.
What else do we need to know about what a broker does?
The mortgage decision is not like shopping around for most consumer items, where you might make a relatively small saving on grocery shopping, utilities or flights.
The wrong decision on a mortgage might cost you hundreds or thousands of pounds in interest over the term of the mortgage. So please seek advice and make informed decisions as you would in other important aspects of your life.
Your home/property may be repossessed if you do not keep up repayments on a mortgage or other debt secured on it.
There may be a fee for mortgage advice. The precise amount will depend upon your circumstances, but we estimate it will be £499.
Chirag Patel trading as CKN Mortgages is an Appointed Representative of HL Partnership Limited which is authorised and regulated by the Financial Conduct Authority.
