Going to the bank or using a broker to get a mortgage? Let’s chat through the pros and cons of each so you can decide what works for you.
Banks obviously want you to come direct to them. Their ads make it seem quick and easy to get a mortgage, right? But it’s not always that simple. Here are a few things to think about:
– With a broker, you can access way more lenders and deals. Brokers have relationships and access that you don’t. At the bank, you’re limited to their own products. More choice means better chance of finding something perfect for your needs.
– Brokers can search the whole market for you. Doing this yourself is super time consuming and complicated! A good broker will find suitable options and explain them in simple terms. At the bank you only get what they offer.
– Banks don’t always have your best interests at heart. Their priority is making money after all! An independent broker works for you to get the best deal.
– If you get knocked back by one lender, a broker can go back to the market rather than making you start over. With a bank, if they say no you have to go elsewhere and redo all the paperwork. Nightmare!
– Brokers really understand how the application process works. They’ll ensure you put your best foot forward to maximise the chance of success. You may not present your situation in the ideal way when doing it direct.
– Sorting a mortgage, yourself takes ages. Brokers handle all the fussy admin for you. Who has time for that?! They make the process as smooth as possible.
– The broker fee may seem annoying but is often paid by the lender. Even if you pay it, the savings they get you usually more than covers the cost. Going direct doesn’t always work out cheaper.
– Brokers advise on protecting your new asset too. Things like insurance are super important for homeowners. The bank won’t flag those things in the same way.
Of course, going direct can work for some people. The bank may offer a competitive deal that suits your needs. Simple situations are easier to handle yourself. But for most, using a broker is the smarter move.
In summary, brokers unlock way more choice, do the arduous work for you, and aim to get you the perfect mortgage for your circumstances. Banks focus on selling their own products and rely on you understanding everything.
If you do go direct but get declined, brokers can often still help. The bank uses quite crude, limited criteria to make decisions. A good broker will look at your situation in more detail and find alternative options. So if you do get that dreaded rejection, don’t give up. Speak to a broker before you bin off the dream of owning your home.
One final thing to note – the Bank of England base rate is currently 5.25%. This influences mortgage rates so just something to be aware of. But a good broker will find you the most competitive deal regardless of what the base rate is doing.
Hope this overview gives some food for thought on the broker vs bank decision! Let me know if you have any other questions.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
