Mortgage Broker v Direct to Lender

Let us have a look at the differences between seeking advice from a Broker versus direct to a lender.

There are many differences but let us explore the key ones.

Available Mortgage Schemes / Choice

Direct to Lender – Each lender will have access to their own products only they cannot advise or recommend other lenders products. After all, why would they?

Broker – Independent brokers will generally have what is called, “whole of market access”, this gives the broker access for their clients to many different Banks and Building Society Lenders. There are approximately 100 mortgage lenders in the UK.

Some lenders will not be available to all brokers as they may be direct to consumer only. However, an Independent Broker can advise you on the schemes that they may not have access to. There would generally be a small fee for this type of independent advice. Accessibility

Direct to Lender – Lenders may often want you to attend mortgage appointments in branch at a time convenient to them. More lenders are adopting online processes to speed up the process, however it may still take a few days and sometimes weeks to arrange a suitable time.

Broker – Brokers are generally more accessible and therefore appointments can often be made for the same day. Many brokers will offer telephone or online meetings to make the process of assessing your requirements more convenient. Mortgage Advice

Direct to Lender – A lender can only advise you of the products that they have available and are limited to their set criteria and affordability assessments. A lender will generally only give advice on the mortgage product and term and assurance products most often from a single insurance provider.

Broker – A broker can advise you on the products available from the whole of market, therefore giving you access to a far wider range of available products and criteria.

A broker will advise on the home buying process, gaining a Mortgage Agreement, mortgage products, instructing conveyancers and insurance from generally a whole of market offering.

Interest Rates / Payments

Direct to Lender – A lender can only offer their own products at every stage of your mortgage journey.

Broker – A Broker will generally review your mortgage options at key stages of your mortgage journey, these reviews normally take place when you are reaching the end of a scheme period, such as a fixed rate ending. Whilst a lender may initially have the best deal for you, it is unlikely that they will continue to have the most cost-effective scheme throughout your mortgage term, So, switching lenders can often save you £100’s if not £1000’s over the term of a mortgage. What to Do If a Mortgage Application Is Declined?

Direct to Lender – a lender will only offer a mortgage based on the mortgage applicant(s), meeting their affordability and criteria checks in full, and provided that the property is suitable as security for the loan. If the lender is not satisfied with any element of their robust checks, then even if you have had, an agreement in principle, the lender could still refuse to offer the mortgage. This means starting the mortgage application process again from the start.

Broker – when a broker carries out initial research and assessment. They will perform criteria and affordability checks. This means reviewing the mortgage applicant’s documentation and assessing which lenders would be suitable for the required mortgage and applicants. If the lender does decline a mortgage application, then in most cases the broker will know why. This then makes it easier to find an alternative solution and lender that can/will assist with lending. This will generally make the reapplication process much quicker for the mortgagee. Protecting your new home

Direct to Lender – when buying a freehold property a condition of your mortgage will be to arrange suitable buildings insurance. You may also consider important aspects such as life assurance. Most lenders will have a sole tie arrangement with insurance companies and not a whole of market offering.

Broker – Protecting you and your new home is seen as an important aspect of the advice journey and process. Brokers will generally have “whole of market”, access to insurance companies and can therefore provide you with recommendations and advice based on a range of different products and providers.

My Mortgage & Protection Experts are specialist Independent Mortgage Brokers. Our ethos is ensuring that our clients benefit from quality, professional mortgage & protection advice.

It is important to work with our clients on an ongoing basis to advise on suitable mortgage products that will focus on suiting their current needs and requirements plus focusing on reducing interest paid and repayment of their mortgage in as short a timescale as possible. Protecting our clients is also a fundamental aspect of our advice process. Advising clients on how best to protect their home, their family, and their income.