The mortgage market is quite mature these days and there are many firms out there offering mortgages and advice to the homebuyer. As with all professional services, the level of service will vary and therefore, it’s important that you ask some very specific questions when deciding which firm to use.
They are;
- Can you obtain mortgages from any UK lender?
- Do you Charge a Fee?
- Are you a qualified Mortgage Adviser?
Of course, it’s all well and good asking these questions, but what do you do with the answers? Well, let’s see if we can help.
1. Can you obtain a mortgage from any UK lender?
If the answer is ‘no’ this probably means that the broker is tied to a specific lender or a panel of lenders. This means that they cannot offer you the widest range of options that might suit you. This isn’t great, as you’ll be missing out on what’s available to you from other sources, so this is worth considering.
If they say, ‘we check all mortgages offered to brokers’, sometimes known as ‘whole of market’ then this means that any mortgages offered exclusively from lenders outside the brokerage market won’t be included in their advice.
In many cases lenders that do not use brokers offer their services directly or through their own panel or specific in-house broker. Sometimes a ‘whole of market’ broker will also consider these lenders although it may be necessary for them to charge you a fee when the lender won’t pay them a commission.
2. Do you charge a fee?
Mortgage brokers make their money by charging for their expertise and access to the market of lenders. Using one will almost certainly save you a great deal of time and also save you money. Do check if their fees are upfront or if you dont have to pay until you receive your offer.
A commission is also payable from a lender to the broker and is referred to as a procuration fee. This fee is usually between 0.35% and 0.5% and the broker must advise you of this amount before making a mortgage application on your behalf.
3. Are you qualified?
The financial services sector is heavily regulated and fairly sophisticated. This means that it’s sensible to use a broker that is properly qualified to give you the best advice. The brokerage should also be properly regulated and hold insurance for professional liability.
Mortgage Required is an Award-winning Independent Mortgage Broker and is regulated under the Financial Conduct Authority.
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