Mortgage brokers (also called mortgage advisers) are not just for people with a poor knowledge of how mortgages work. They’re also highly recommended when you’re in a tricky personal or financial situation and unsure which lenders are likely to offer you a deal.
Mortgage brokers have a deep understanding of the various criteria that individual lenders require to approve an application, so they can point you towards the best deals that you’re likely to be approved for. Recently, a number of online mortgage brokers have also begun operations.
You’ll save a lot of time and stress working with a mortgage broker. More importantly, it should prevent you from destroying your credit score by making multiple failed mortgage applications.
Latest mortgage brokers
The UK’s largest fee-free mortgage broker; London & Country (L&C) has offices in Bath, London and Newcastle.
You can use its brokerage service online or over the phone. The broker estimates it could only take one 15-20 minute online survey, plus another 15-20 minute phone call to finalise your mortgage.
- Free to use.
- Deals from more than 90 lenders are compared.
- You can use its online service 24 hours a day.
- L&C mortgages is regulated by the FCA.
- L&C doesn’t compare the whole of the UK mortgage market, so there’s no guarantee you’ll find the absolute best deal for your needs.
Habito is an online service, which compares more than 20,000 mortgages, then connects you with a mortgage broker to help you find the best deal for your needs. If the best deal is found outside its list of 90+ lenders, the service will encourage you to apply to that lender directly.
You’ll fill out a 15-minute survey illustrating what type of mortgage you’re looking for, then communicate with a broker via telephone or live online chat.
- Habito is free to use.
- It’s quick and hassle-free.
- You can use it 24 hours a day.
- You can speak to a human advisor online whenever it’s convenient for you, including evenings and weekends.
- Habito will help you submit a mortgage application to 90+ lenders.
- If the best deal is found outside its list of lenders, it’ll encourage you to apply to this lender directly.
- Habito is regulated by the Financial Conduct Authority.
- Refer a friend and you’ll each receive a £100 cash reward once they complete their application.
- There is no assistance offered when initially entering your information.
- Habito’s algorithm might struggle to find you the best deal if your financial circumstances are complicated.
Mojo Mortgages is an online-only mortgage broker service. It aims to make the process of finding the best mortgage for you seamless.
First, you’ll answer a 60-second questionnaire to check if you’re eligible for any mortgage in the UK. Then, you’ll answer a more detailed questionnaire to help the website determine what type of mortgage is likely to be best for you.
- It’s free to use (Mojo Mortgages will receive a procuration fee when you switch)
- Compares the whole market
- A simple questionnaire that takes about 15 minutes to fill out
- Unbiased, independent advice
- You can use the Mojo Mortgages website 24 hours a day
- Access to professional mortgage advisers
- Regulated by the FCA
Trussle offers a similar service to Habito, allowing you to answer an online questionnaire, then be recommended some great mortgages based on your answers.
You’ll be able to connect with a Trussle mortgage broker via phone, email or live online chat to finalise the deal.
Trussle doesn’t compare the entire UK mortgage market, but you’ll be able to find the best of 11,000 deals from 90+ lenders.
- Trussle is free to use.
- You can use it 24 hours a day.
- You can speak to a human advisor online to ensure you get the best available deal.
- It’s regulated by the Financial Conduct Authority.
- You’ll be notified whenever you could save by switching to a new deal.
- It covers over 90 lenders with over 11,000 deals.
- Trussle doesn’t search the whole market.
- The online form is more convoluted than its competitors.
Simply Adverse is an online-only mortgage broker service, which helps UK residents with poor credit find the best mortgage for their needs. It specialises in finding mortgages for people with any form of bad credit. The company has been helping UK residents in this situation for close to a decade.
- Simply Adverse brokers specialise in working with customers who have bad credit.
- You can get advice from Simply Adverse brokers for free. You’ll only pay a fee if you proceed and receive a mortgage offer.
- The fee is a flat rate (£1,995), no matter how big your mortgage is.
- Simply Adverse works with all the major lenders that offer bad credit mortgages.
- You begin with a simple and quick online questionnaire to test your eligibility.
- You can use the Simply Adverse website 24 hours a day, and arrange a call for whenever is most suitable for you.
- You could be eligible for a mortgage, even if you have suffered from bankruptcy, CCJs or an IVA.
- Simply Adverse is regulated by the Financial Conduct Authority.
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.
How to choose the best mortgage broker
Here are the three main factors to consider when choosing one:
- 1. How many lenders they compare. A lot of mortgage brokers only work with specific lenders. Some brokers who claim to be “whole of market” won’t check lenders that offer “direct only” mortgage deals, although others will. Either way, it’s important to be clear about how many lenders your broker will compare on your behalf. If it’s not truly “whole of market”, you’ll need to ensure you check the remaining lenders in order to guarantee yourself the best deal.
- 2. Fee. Some brokers don’t charge a fee, because they receive commission from lenders instead. Others will charge their customers a one-off fee. Make sure you’re aware of how much and when you’ll be charged.
- 3. Customer service. Check for testimonials on brokers’ websites.
Are mortgage brokers better than banks?
While many people could be put off the idea of using a broker due to the fees some of them charge, the reality could be a lot different if they find you a good deal from the many mortgage products they have access to. You may end up saving thousands of pounds in the long term. However, it’s worth noting that some banks will have certain deals that are only available directly to borrowers and not through brokers.
Advantages of using a mortgage broker
- Peace of mind. This a huge financial decision you’re making, so there’s a lot to be said for being sure you’re doing the right thing. Buying a house is stressful enough without wondering whether you’ve made a six-figure mistake. You’ll be able to question your mortgage broker about any part of the house-buying process you don’t understand.
- It saves time. Comparing every mortgage on the market is a time-consuming process and applying for one isn’t a walk in the park either. Lenders will ask you for all types of paperwork and it can sometimes take weeks for them to process your application. A mortgage adviser can find the best deal for you and assist you with your application, helping to streamline the process and boost your chances of being approved.
- Knowledge of unique mortgage situations. Do you have bad credit or low income? Are you buying an unusually constructured property? Have you recently changed jobs, separated from a spouse or suffered a bankruptcy? All of these situations will affect your mortgage application. A mortgage adviser will know which lenders are best placed to approve applicants in these scenarios.
- Protect your credit score. When you apply for a mortgage, you’ll be credit checked and this will result in your credit score decreasing slightly. That’s no big deal if your application is approved, but it becomes a problem when you rack up multiple failed applications. In this situation, your credit score could take a serious dip, potentially harming your chances of being approved for any decent mortgage deals in the short-term future. By using a mortgage adviser, you boost your chances of being approved first time around.
- Some mortgages are only available through brokers. These experts therefore provide the easiest way to compare the whole market.
- Some mortgage brokers can negotiate a better deal. Although this is far from a guarantee, many mortgage brokers have reported being able to negotiate a better rate for their customers. This service alone could be worth the fee you pay them.
Advantages of going through a bank (direct lender)
- It saves you the fee. If you’re confident in your ability to find the best mortgage lender, you can save yourself the expense of a mortgage broker’s fee by doing it yourself.
- Work during hours that suit you. When using a mortgage broker, you’ll have to contact them during traditional working hours, whereas you can search and apply for a mortgage online at any time of day.
- You don’t have to rely on anyone. While there are plenty of experienced brokers who would be dubbed ultra-reliable by their customers, not all of them can boast glowing reviews. If you prefer not trusting someone else with your finances, you might like to approach a mortgage provider directly.
Can a mortgage broker negotiate a better deal for me?
Some mortgage brokers will approach a lender and submit an application on your behalf and many claim to be able to negotiate a better deal for you. When you consider how much even the smallest percentage drop could save you over the length of a 25-year mortgage, this benefit could be worth the broker fee alone.
What’s more, some mortgages are only available through brokers, so you’ll get access to a bigger range of deals by using one.
The different types of mortgage brokers
The most important difference is the number of mortgage providers that a broker will compare.
Some brokers are tied to specific lenders. Some will compare deals from a limited list of lenders, while others will claim to be “whole of market”.
Yet, it gets more complicated than that, because some “whole of market” brokers won’t compare lenders that only accept direct applications.
If you don’t use a mortgage broker who actually compares the “whole market”, you’ll need to do additional research to ensure you’re truly getting the best deal.
No-fee mortgage brokers explained
If you’re looking to save some cash, a no-fee mortgage broker could be the right option for you.
These are mortgage brokers that won’t charge you a fee for some or all of the mortgage application process. Some will offer fee-free services for sourcing your mortgage and then charge for arranging it, while others will charge no fee for the entire process.
As such, no-fee mortgage brokers can be an attractive solution if you don’t want to have to pay a large sum of money to secure a mortgage deal.
It is important to know that no fee mortgage brokers make their money by earning commission directly from lenders, which is why their services are not at any additional cost to you. This could mean that you do not get the best possible deal by going through a broker.
At what stage will a mortgage broker charge a fee?
The answer to this question depends very much on the mortgage broker you choose to use. For instance, some mortgage brokers offer a no-fee service for recommending a specific loan. But if you decide to go ahead with their recommendation, then there can be fees of around £500 to pay once you submit the mortgage application. The fee you pay could come alongside another commission fee that the broker would receive from the lender on completion.
Other brokers, like London & Country, offer free mortgage advice from start to finish over the phone. This means you won’t pay any fees, from when their brokers compare and source the best deals for you, to when they help you submit your online application.
While going fee-free will save you money and might sound like the way to go, it’s important to remember that many of these brokers will only be accessible to you over the phone.
Some people may wish to have access to their broker face-to-face, in which case, paying the arrangement fees and opting for a traditional mortgage broker might be a better option for you.
A fee-free mortgage broker may also try to point you towards deals that will earn them a higher commission, which means you may end up paying more in the long term than if you had opted for a deal with a bigger fee in the first place.
What are the pros and cons of using a mortgage broker?
- It’s fast and potentially less stressful
- You’ll be recommended a deal you’re likely to be approved for
- You’re far more likely to find the best deal
- Your broker might be able to negotiate a discount
- Some mortgage brokers charge a fee
- Some mortgage brokers don’t cover the whole market
- You’ll have to work with your broker within their opening hours
The bottom line
Mortgage brokers can save you a lot of time and research, especially if your financial circumstances are unusual. They have an in-depth knowledge of the mortgage market, know which lenders might be more likely to accept your application and often have access to a really wide range of mortgage products.
But there are sometimes fees for using their services, plus some are not “whole of market” or don’t include “direct only” mortgages offered by lenders to borrowers without an intermediary involved. So make sure you research your mortgage broker before you proceed with them.
“The total amount being lent for mortgages in the UK is at its highest point in over a decade. Bank of England figures show that in the last quarter of 2020 the value of new mortgage commitments was 24.2% higher than a year earlier, at £87.7 billion, the highest level since 2007,” says Michelle Stevens, Finder’s deputy editor for mortgages. “However, the share of mortgages advanced with a loan to value (LTV) ratio above 90% was just 1.2% during that period, 4.5 percentage points lower than a year earlier, and the lowest level since 2007.”