#mortgagegoals
What Does A Mortgage Broker Do?
- Maximise Your Borrowing
- Minimise Your Repayments
- Manage Your Mortgage Down
- Handled With Humanity
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What Does A Mortgage Broker Do?
Richard Campo explains the role of a mortgage broker.
What does a mortgage broker do?
The primary focus of a mortgage broker is to work for you – and I can’t stress that enough. You’re our client, and I look after you all the way to the ultimate goal of getting you debt-free.
I’ve done mortgages for more years than I care to remember, and I’ve never met anyone who really wants a mortgage. The goal is to get it paid off. We work with you not just now, but for the duration of that mortgage, and beyond.
Brokers are the main route to market for most people now. According to the Intermediary Mortgage Lenders Association (IMLA), 87% of all mortgages are currently going through brokers, and that’s expected to go up to 91% by 2026.
When I started back in 1999, it was probably less than 50%. There’s been a massive upward curve. There are 92,000 to 99,000 mortgage applications a month, so it’s a huge market. It’s a well-trodden path and we’ll cover some specific points on why it’s beneficial to go through brokers. We simply work for you.
What’s the difference between going to a mortgage broker versus your local high street lender?
If you’ve been to a bank and also to a broker, you’ll know the difference. It’s a wildly different experience. Due to our dominance in the market, brokers do get many exclusive rates and products from lenders. Some lenders don’t deal with the public at all.
It’s a positive move. The market gets more and more complicated every year, so it’s far better to sit down with someone who’ll know what works best for you. If you go to a high street bank, they’re only going to sell you their products. Halifax is not going to tell you to go next door to Santander for a better rate.
A big issue is affordability, which is essentially how much you can borrow. Banks deal with income in very different ways, and Lender A may offer you half the amount you could get with Lender B. It doesn’t necessarily mean the rate’s higher, either. It’s all down to how things are assessed.
That’s a key difference in coming to a broker. If you’re buying for the first time or looking to move, your two primary questions are how much it will cost and how much you can borrow. We look across the entire market for you and save you the legwork. AI searches are great, but as we’re talking, they can’t quite do that bit yet. I’ve still got a job for the time being.
To give you an idea of the challenge, I took some figures from 27 Tech, a mortgage platform we use. In March 2024, they passed a new record of 21,000 mortgages being available at a single moment – up 7% on the previous month.
That’s a crazy amount of choice, and will be down to variants of a product – whether you take cashback versus free legals, whether fees are added and whether you fix the rate for two or five years. There are so many options. So let us figure out what’s important to you, research the market and come back to you. That is the key difference of dealing with a broker as opposed to a bank.
What services does a mortgage broker offer?
Basically, if you need finance on a residential property, we can do it. That’s what we’re regulated to do. You might be buying for the first time, looking to move, looking to refinance, investing in a Buy to Let property or refinancing lots of properties.
It might verge into bridging and development finance. Bridging has always had something of a bad reputation, which is very unjust. I call it short-term finance, and it can fit very specific needs, up to and including development finance.
If you need to redevelop a property, that’s a whole topic in itself. Some lenders will let you do certain work, up to and including knocking a house down and starting again. So if a residential property is involved, we can finance it, including all those things and more.
A lot of work goes into finding a mortgage. There are documents to obtain, credit files to go through, affordability to assess. There are estate agents and solicitors involved. We’re the one party that can tie everything together and talk to everyone in the process. That’s probably the biggest value we add – it’s much more than simply finding the mortgage.
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When should I see a mortgage broker?
There’s never a wrong time, and I’d suggest talking to us as soon as possible. I’m always happy to talk to clients very early in the process. I’ve lost count of how many times I’ve spoken to a client who wants to buy ‘in the next few years’.
That’s an absolutely fine way to start a conversation. Sometimes it happens quicker, sometimes it doesn’t happen at all. You want to know how much you can borrow and how much it will cost – and the only way we can answer those questions is by speaking to you.
When you come to refinance, there is a specific timeline – we want to talk to people at least six months before their current product ends. But again, I’ll contact you in advance of that. You might want to make changes to the mortgage at that point.
When you’re looking to move, the amount you can borrow will shape your property hunting. If you can’t get the borrowing you want, maybe we can restructure the loan to keep costs down. There are many different product options, so let’s get you in a good financial shape first and we’ll catch up at the right time thereafter.
Does it cost for an initial conversation with you?
No. It costs absolutely nothing just to talk. We want to make sure we can help you, so pick up the phone and get in contact. 90% of my meetings are online these days – Teams, Zoom, Google Hangouts – whatever your weapon of choice, I’m pretty amenable.
One thing I would stress is that it’s worth talking. I’ve mentioned the complexity around different products, and that’s just one aspect. It’s almost impossible to get that into a written conversation via email or WhatsApp. People like to fire questions across and I’m not that good a writer to make my replies interesting – but by talking we can get things in shape.
What else do we need to know about how a mortgage broker can help?
One, we work for you. You’re my client. That’s the big difference with a broker, including all of the benefits around exclusive products, access to lenders, and simply doing the donkey work.
AI searches are great, but they’re not quite there yet. Mortgage prices change so quickly, and all the intricacies around lenders’ credit criteria, profiles and scoring is not publicly available – it’s commercially sensitive. So you can only research to a point.
It’s right to work with a professional because we know the nuances and we have the relationships. I can pick up the phone to an underwriter or other contacts at the bank and get things through.
The second key thing is that I only get paid once you complete on the mortgage – so if you don’t get the mortgage, I don’t get paid. That means our interests are aligned. I want to make sure you get the right product, most suitable outcome and it all goes as smoothly as possible.
I don’t want to waste your time or mine. That alignment of our interests generally leads to good outcomes for both of us.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH YOUR MORTGAGE REPAYMENTS.
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