There is more to buying a house then working with an estate agent to find a property that fits your family. You are also working with a solicitor, an appraiser, and a range of other professionals. Then there is the lender to consider. Your choice of lender will affect everything from the terms of your mortgage to the amount of interest you pay.
Getting a mortgage can be approached in one of two basic ways. Your first option is to go straight to your bank or building society and inquire about what they have on offer. Your second option is to skip the banks and building societies in favour of a mortgage broker. The question is this: which is the better option?
Pound for pound, a mortgage broker is going to be the better choice for most first-time buyers. Even repeat buyers tend to do better with mortgage brokers. There are lots of reasons explaining why this is so, including the three listed below. When all is said and done, it boils down to sound broker advice for first time buyers. It is advice buyers do not usually get from bank loan officers.
1. Understand the Deals on Offer
A typical mortgage broker has access to a complete range of deals. In terms of sheer volume, the deals easily surpass the limited number offered by banks and building societies. So right off the bat, there is more information to deal with. The beauty of working with a mortgage broker is that you’re also working with a financial adviser who specialises in the mortgage market.
Your mortgage broker’s experience will prove invaluable in helping you understand all of the deals on the table. Where you might speak to a bank or building society loan officer and not get any real insight, it is in the best interests of the broker to make sure you understand everything being presented to you.
Remember, the mortgage broker only gets paid when you allow him or her to arrange a mortgage for you. The loan officer gets paid whether you take the bank’s deal or not. So again, it is in the best interest of your mortgage broker to make sure you get answers to all your questions. It is in your broker’s interest to make sure you get the best deal possible.
2. Find Deals That Suit Your Needs
Understanding mortgage information is just the start. Another reason for choosing a mortgage broker over a bank or building society is the possibility of getting a mortgage perfectly suited to your needs. This is where an independent mortgage broker really offers an advantage to first time buyers.
Banks and building societies only offer a limited number of mortgages. Moreover, their mortgage deals are more likely to suit their needs rather than yours. Tied brokers are in the same position inasmuch as they represent only one lender. Multi-tied brokers are a little better in that they can represent several lenders. But an independent broker isn’t tied to any institutions in particular. He or she can look for deals wherever these are found.
What does this mean to you? It means that finding a mortgage that suits your circumstances is a lot more likely when you give your business to a mortgage broker. With a broker working on your behalf, you are going to have access to deals you will never find from a bank.
3. Present Yourself in the Best Possible Light
The last reason for choosing a mortgage broker is something not a lot of people understand. It is all about your mortgage application. When you apply for a mortgage, you have to provide the lender with certain kinds of information that can be used to determine your creditworthiness. Rest assured that lenders look at a lot of things.
What you might not know is that there are ways to present that information to show yourself in the best possible light. Your mortgage broker knows this. And based on what was discussed earlier, it is in your broker’s best interests to make sure your circumstances are presented as positively as possible.
Your mortgage broker can advise you on how to fill out mortgage applications. He or she can help you figure out the best way to present your financial position. If you are self-employed, a broker can advise you on the types of documents you should produce to verify your income. Best of all, the advice is free of charge.
Banks and building societies will offer you a mortgage. So will private lenders. You can choose to go to a single lender and put your hope in your lucky stars that you will get a good mortgage deal. You can spend months shopping around among multiple lenders yourself. Alternatively, you could go to a mortgage broker from whom you will receive free advice, answers to every question, help presenting yourself in the best possible light, and access to deals perfectly suited to your circumstances.
Which option sounds best to you?