Finding a mortgage can feel complicated. First,you need to compare rates, then understand lender criteria and lastly choose a mortgage product that suits your plans. However, a mortgage broker can guide you through these decisions and manage much of the application.
A broker could save you time whether you are a first-time buyer, moving home or remortgaging. Their knowledge may be especially useful if you are self-employed, have bad credit or need a less common type of mortgage.
Our guide explains how mortgage brokers work, what they charge and how to choose one.
What to know about mortgage brokers
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A broker compares mortgage options
A mortgage broker compares rates, fees, features and lender criteria across the products they can access.
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Advice reflects your circumstances
The adviser considers your income, deposit, credit history and plans before recommending a suitable mortgage.
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Lender access varies between brokers
Some brokers use a limited panel of lenders. Muttuo compares mortgage options from over 100 lenders.
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A broker supports your application
They can prepare the paperwork, speak to the lender and manage your application through to offer.
Compare your mortgage options
What is a mortgage broker?
A mortgage broker, also called a mortgage adviser, helps you find and apply for a mortgage.
The broker acts as the link between you and a mortgage lender. They review your needs, compare the products they can access and recommend a mortgage that may suit you.
The broker does not provide the loan. Banks, building societies and other mortgage lenders issue mortgages and decide whether to approve each application.
What does a mortgage broker do?
A mortgage adviser reviews your income, spending, deposit, credit history and property plans. They use that information to assess your options and identify lenders whose criteria may fit.
They can then:
- Explain the types of mortgage available
- Compare interest rates, fees and product features
- Make suitable mortgage recommendations and explain their reasoning
- Prepare your application and manage lender questions through to offer
Mortgage advice looks beyond the lowest rate. Fees and features can change the total cost, so a higher rate with a lower fee may cost less overall.
How mortgage brokers work
The number of mortgage products a broker can compare depends on the service they offer. Some advisers recommend products from one lender. Others use a panel of lenders or search across a wider part of the mortgage market.
A whole-of-market broker may not have access to every mortgage. Some lenders reserve deals for direct customers, while others offer deals only through brokers. Before choosing a broker, ask how many lenders and products they can access.
Muttuo compares suitable options from over 100 lenders. We explain the available choices and any limits before recommending a mortgage.
Mortgage broker vs mortgage lender
A mortgage broker provides advice and helps manage your application. The mortgage lender supplies the loan, sets its criteria and decides whether to approve you.
You can apply directly to your bank, but its adviser can normally only discuss that bank’s products. A broker can compare multiple lenders and may find options that better match your income, deposit or property.
However, the lender always makes the final decision. A broker cannot guarantee approval, a particular interest rate or a set borrowing amount.
Can a broker help with a specialist mortgage?
A broker may help if you are self-employed or work on contracts. Their advice may also be useful for later-life borrowing or an unusual property.
A mortgage broker for bad credit may also help if you have missed payments or other credit issues. They can find lenders that may consider your application. However, lenders will still check affordability, and no broker can guarantee approval.
Some advisers do not cover every type of mortgage. Check that the broker has relevant experience and permission to advise on the product you need.
When should you speak to a mortgage broker?
You can speak to a broker before you start viewing homes, especially if you need help setting a realistic budget. They can estimate your borrowing and explain the deposit you may need.
An adviser can also help after a seller accepts your offer or when you want to remortgage. If your current deal is ending, starting early gives you time to compare mortgage products and gather documents.
See what you could borrow
Do you have to use a mortgage broker?
No. You can compare mortgage rates and apply directly to a lender. Going direct may suit you if your finances are straightforward and you already know which product you want.
However, a broker can reduce the research and paperwork involved. A regulated adviser can also recommend a mortgage based on the information you provide. You still need to check the mortgage documents and decide whether to proceed.
Advantages and disadvantages of using a mortgage broker
Advantages of using a mortgage broker
A broker could save you time
Comparing mortgage products and lender criteria takes time. A broker can narrow the search to realistic options and manage much of the paperwork.
You receive a personal recommendation
Mortgage advice looks beyond the interest rate. A broker should consider fees, features, affordability and your plans before recommending a product.
Some deals are broker-only
Some lenders and mortgage products are only available through brokers. Access varies, so ask which lenders and deals the broker can compare.
Disadvantages of using a mortgage broker
You may pay for mortgage advice
Some brokers charge a fee, while others receive commission from the lender. Some use both methods. Ask how the broker receives payment and when you must pay any fee.
A broker may not cover every lender
A broker may use a limited panel of lenders and cannot compare every deal. Some lenders also offer products only to direct customers.
Service and experience vary
Check the broker’s qualifications, FCA status and relevant experience. Reviews and clear communication can also help you assess their service.
What do mortgage brokers charge?
A mortgage broker fee can cover the work involved in comparing lenders, recommending a mortgage and managing your application.
Broker fees vary. Some charge a fixed amount, a percentage of the mortgage or an hourly rate. A broker may also receive commission from the lender after arranging your mortgage.
Before you agree to the service, the adviser should explain how they receive payment and outline all costs. Compare each broker’s fee with their lender access and level of support.
Muttuo’s mortgage advice fees are:
- Existing Muttuo customers: No advice fee
- Standard mortgage advice: £499
- Complex mortgage advice: £749
If an advice fee applies, you only pay it after receiving a mortgage offer from a lender.
Should you use the broker recommended by an estate agent?
You may use the broker recommended by your estate agent, but you are free to choose another. Ask whether the agent receives a referral fee for making the introduction.
Before deciding, compare the broker’s fees, lender access, service and FCA status. A recommendation does not always mean the broker will be the right fit for your needs.
How to choose a mortgage broker
Ask these questions before agreeing to mortgage advice:
- Can you find the firm on the FCA Register?
- What qualifications and relevant experience does the adviser have?
- How many lenders and mortgage products can they consider?
- Are there fees charge by the broker, and when must you pay them?
- Who will manage your application after submission?
- How will the broker update you throughout the mortgage process?
Check the firm and its permissions using the FCA Firm Checker or Financial Services Register. Reviews can help you assess the service, but they should not replace regulatory checks.
Is a mortgage broker worth it?
A mortgage broker can compare lenders, manage your application and explain your circumstances to the lender.. They can explain the main differences between products and may save you time.
Some brokers can access broker-exclusive mortgage deals that lenders do not offer directly. However, each broker works with a different range of lenders.
A broker may also help if your income, credit history or property falls outside a lender’s usual rules.
Before deciding, compare the fee, lender range and support each broker offers. A good adviser will explain why they recommend a mortgage. However, they cannot guarantee approval.
How Muttuo Mortgages can help
Choosing a mortgage can involve a lot of research. Muttuo compares options from over 100 lenders and helps you understand which may suit your needs.
Muttuo Mortgages can help you:
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compare mortgage rates, fees and product features
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identify lenders whose criteria may fit your circumstances
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explain our recommendation and answer your questions
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prepare and manage your application through to offer
Tell us about your plans, income and property. We will explain how we can help, which fee applies and what happens next.
Ready to compare your mortgage options?
Speak to Muttuo for help comparing lenders, rates, fees and product features.
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