What Does A Broker Do?

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What Does A Mortgage Broker Do?

Sam Hubbard introduces the company and explains the role of a mortgage broker.

What does a mortgage broker do?

We effectively act as a middleman between clients and potential lenders when they’re looking for a mortgage or a remortgage.

But what does that really mean? We offer practical help and guidance to find the right lending solutions. For example, we determine which lenders will provide the required loan amount, where you meet the lender’s criteria.

We help clients find the most suitable deals by comparing offers from most lenders in the UK including banks, building societies and and other lending institutions. We break things down into bullet points to make it more understandable.

The first thing we do is understand our client’s needs and requirements. That process generally starts with a no-obligation meeting or phone call which lasts about 30 minutes. That conversation helps us understand our client’s objectives and what they want to achieve.

That process is generally the same, whether the client is a First Time Buyer, they’re remortgaging or even buying an investment property.

The second step is to assist you by shopping around for the most suitable deals. Instead of you having to approach every lender on the high street individually, brokers do the legwork. We first complete affordability assessments to determine which lenders will lend the amount you need – or establish the maximum amount that can be borrowed. We then ensure that your requirements fit the lender’s criteria.

The third major point at the start is explaining the mortgage options. Once we’ve completed our research, you’re provided with a detailed report that includes how much you can borrow, interest rates, early repayment charges and lender costs such as arrangement fees or valuations.

This is generally just a starting point – and the journey can often change. The loan amount and deposit amount could change. We’ll come back and reflect and review the research to make it appropriate.

The bottom line is that we help clients find the most suitable mortgage for their needs and situation. Once that suitable solution is agreed, we then provide them with an Agreement in Principle before they go any further.

What’s the difference between going to a mortgage advisor versus your local high street lender?

The simple answer is that a high street lender can only offer products from their range.

They can’t offer anybody else’s products. A different lender may be able to provide a more competitive deal or an alternative lending solution, with perhaps a larger loan size, improved loan criteria, or a more cost effective deal overall.

By speaking to a broker, you’re not restricted to one lender’s offering. And with thousands of mortgage products available, why be restricted? A whole market broker like us will offer products from thousands to find you the most suitable solutions to suit your needs and requirements.

What services does a mortgage broker offer?

First and foremost, we’ve got access to more mortgage options. At MMPE, as we’re known, we’re whole-market, meaning we have access to a wide range of lenders – so we provide more choice than working directly with any one bank, building society or lender.

We provide expert guidance from qualified and professional brokers that have an extensive knowledge of the mortgage industry. We help you navigate complex jargon, rules, regulations and keep you informed so you can make the right decisions.

Working with a broker can save an immense amount of time and effort. Instead of spending hours applying to different lenders, a mortgage broker can do all the heavy lifting and will handle all paperwork and logistics. On occasion, we have access to exclusive products and rates which aren’t available through the lender branch networks.

A key benefit of working with a mortgage broker is our expertise in lenders’ different affordability criteria. Lenders all have different guidelines on how much they are willing to lend depending on factors like income, spending habits and credit score.

Eligibility can be really complex and is impacted by all those factors. Which lenders will lend and which won’t? The bottom line is that a broker really helps clients navigate all these complex criteria to find the right deal and most appropriate solution.

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Buying/selling a property or making sure you are on the right mortgage deal can be stressful. That’s where we come in, let us take the stress away with a personal, speedy, and professional service.

Can you also help with mortgage protection?

As mortgage brokers, we have a duty of care to our clients and so we advise them on appropriately protecting themselves with insurance, such as building insurance for the property.

Equally, it makes sense for most people to review their life assurance, income protection and critical illness cover, as these can protect your loved ones in the event of unfortunate circumstances.

After all, having worked hard to buy a property, the last thing anyone wants is an unfortunate situation that means the property must be sold.

When should I see a mortgage broker? At what stage in the process of applying for a mortgage and looking at properties?

I would always recommend speaking with a broker sooner rather than later. It gives you peace of mind to confirm how much you can borrow, what the most suitable rates are and what the monthly costs are likely to be.

Equally, most estate agents will ask for proof of the mortgage agreement or cash funds before they’ll accept an offer from a home buyer. So it really does make sense to evaluate the options with a broker and get the mortgage agreed in principle as soon as you possibly can.

Does it cost for an initial conversational consultation with you?

At MMPE, we don’t charge upfront costs or upfront fees. We provide all the initial due diligence and research at no cost to our clients.

Basically, if we can’t find the right solution, we’ll never charge a fee. Another critical question could be, how much will working with a broker actually save me?

Our standard broker fee for a new client is £395 and that would be payable after we’ve gone through all the due diligence, providing research, agreeing on a way ahead and getting an Agreement in Principle in place. Only at the point of mortgage application – once the property is found and an offer has been accepted – would a fee actually be payable.

When a product comes to the end of its term, such as when a two-year fixed rate finishes, if we did nothing at that point in time, the deal would revert to the lender’s Standard Variable Rate – which in most situations means an increased monthly payment.

We run reviews for all our clients at that stage, comparing what their existing lender will offer and what the open market offers. Providing there’s no change to terms or any additional borrowing, we don’t charge again.

As you can imagine over the term of a 20 or 40 year mortgage, you can have immense cost savings. Working with a broker can generally save thousands over the term of your mortgage.

We’ve covered a lot there, but have you got anything else you’d like to add?

There are a couple of things that may be worth pointing out. Firstly, things don’t always go right with mortgages and not all applications are straightforward.

Lenders can sometimes agree in principle and subsequently request further information or documents from you to decide whether to lend. Occasionally they will decline applications.

This is where a good broker will add real value. We frame responses correctly back to a lender and provide information to progress the application. That dramatically increases the likelihood of a mortgage offer coming forward. And, if the worst possible situation did happen and a case was declined, we’re not starting again.

We already have all the inside knowledge of that situation. We know the pitfalls, and we research again to find the solution. You’ve got help on your side, rather than having to start the whole process again.

Another important factor is that as a professional broker firm, we support the transaction from start to finish. From the moment a client starts looking at homes or wants to remortgage right through to the day of completion, we’ll be there every step of the way.

Our aim is to streamline the process, assist with questions or concerns that arise and support you through the transaction journey, which can often be challenging. I hope that gives a good summary of how we can help.

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH YOUR MORTGAGE REPAYMENTS.

THE FINANCIAL CONDUCT AUTHORITY DOES NOT REGULATE MOST BUY TO LET MORTGAGES.

Our standard fee for arranging a mortgage is £395. The fee is due upon applying for a mortgage loan with the lender.