Using A Mortgage Broker Could Save You Thousands – But How?
When it comes to buying a home either as a first time buyer or as a home mover, one thing is for sure and that is that the majority of us will need to take out a mortgage. Unlike other forms of borrowing, a mortgage isn’t seen as a ‘bad debt’ and won’t be counted against you on further credit checks (unless you default on payments, of course), however choose the wrong one and you’ll see yourself paying thousands of pounds more than you need to over the lifetime of the mortgage. One surefire way of ensuring you’re getting the very best deal on your mortgage is to use the services of a mortgage broker and to take a look at how and why going down this route could see you saving thousands, we’ve teamed up with David Sharples of Search Mortgage Solutions.
Why Are So Many People Choosing To Use A Mortgage Broker?
Last year saw the Mortgage Market Review bring into force stricter lending criteria making it harder than ever to get approval on a mortgage. Whilst things are getting a little easier than they were twelve months ago, the general consensus of borrowers is that the advice and assistance of a professional mortgage broker will increase their chances of approval; something which is absolutely correct! With the national news awash with the difficulties homeowners are facing having become ‘mortgage prisoners,’ even those who already have a mortgage on their current home are using the services of brokers to increase their chances of securing their dream home to move up the property ladder.
What Can A Mortgage Broker Help With?
Whether you’re a first time buyer or a home mover, one thing is for sure and that will be that you’ll have far more on your ‘to do’ list than you have time for. As such, a mortgage broker can become invaluable in more ways than one, saving you time as well as money. In order to generate an understanding as to what a mortgage broker can actually do for you, we’ve outlined the main points below:
1. Assess Your Current Financial Circumstances
Whilst you may have found your dream home, can you afford it? Will your financial circumstances meet the criteria of the various lenders? A mortgage broker is not only there to help you find a mortgage but also to ensure that you get approval and, as such, it’s in their best interest to closely analyse your finances with you. They’ll be able to match your circumstances with the lender’s criteria and advise you as to the approximate level of borrowing you’ll be able to obtain.
2. Explain The Different Options
Do you know the difference between fixed rate and variable mortgages? How about between discount and tracker ones? No, we thought not! Most borrowers have little idea as to the difference between the different mortgage products available and, as such, the advice given by a mortgage broker becomes invaluable! Choosing the right type of mortgage can play an important role in ensuring you get the best deal and with so many factors to consider, it’s often best left to the professionals!
3. Find You The Best Deal
Whilst there’s nothing to stop you comparing mortgage deals online, ask yourself whether you truly understand the difference between offerings from different (or even the same) lenders. Most borrowers couldn’t truly identify whether or not two mortgages are identical for comparison purposes and once again that’s where a broker’s advice becomes vital! In addition, in many instances, brokers are able to access exclusive deals and get the very best interest rates, ones which you’d never have access to by going to the lender direct. In many cases, these deals could see you saving thousands over the lifetime of the mortgage.
4. Handle The Paperwork & Application For You
Filling in a mortgage application can be a daunting task, especially if you’ve never done it before and if anything is done incorrectly, it could mean the whole mortgage is rejected. Not only will a mortgage broker find you the best deal but they’ll also fill out the application for you to ensure it’s done right and that there’s no errors contained within it. Again this is a huge time-saver and just another attractive offering for many applying for a mortgage.
But How Much Does It Cost To Use A Mortgage Broker?
Whilst there’s no denying how valuable the services of a mortgage broker can be, in many cases both first time buyers and home movers (if they didn’t go down this route for previous mortgages) are conscious of how much it will cost. We know all too well that either buying your first or moving house takes every last penny most of us have and, as such, it’s important that every last penny is carefully accounted for.
The best news here, then, is that, in some cases, using a mortgage broker is completely FREE.
That’s right, many brokers charge NO FEE, meaning you can use their services without adding a penny extra onto all of the other costs associated with buying a house. Brokers receive a commission from lenders for arranging the mortgage and, as such, you’ll find a number who will waive any charges to the borrower, working solely on the commission they receive.
David of Search Mortgage Solutions commented to us, “We chose to go down the route of offering a no-broker-fee service to ensure that we’re as accessible as possible to those right across the market from first time buyers through to those looking to arrange a buy-to-let mortgage or even remortgage their house. Whilst some brokers do charge a fee, we feel that by offering a no-fee service, we’re still able to provide a premium offering without adding any extra to the costs which we know are already high in most cases.”
At the end of the day, when it comes to using a no-fee broker, there’s absolutely nothing to lose and, as such, it’s something we strongly recommend and the reason behind the growth in popularity of brokers in recent years.