Applying for a mortgage is one of those things in life that you have to prepare yourself for, it's not a subject that’s often taught in schools and you can’t always rely on other people such as your parents to give you the knowledge you’ll need or if they do the information may be outdated. Because of this most people that are applying for a mortgage have little to no awareness about mortgages when they start the process. Given that a house purchase is a pretty big deal, you’ll probably want all the help you can get along the way.
The biggest and best resource you’ll have on your mortgage journey is a mortgage broker also known as a mortgage advisor. Mortgage brokers are legally obligated to advise you on the best mortgage options available to you, depending on your circumstances. It's worth noting that you aren’t in return, obligated to accept their advice, though they are trained professionals so don’t be too quick to disregard their advice. If you are looking for a mortgage broker and based in Melbourne, Australia, check out Blutin Finance here:: https://www.blutin.com.au/.
That being said, not all mortgage brokers are created equally and a good mortgage broker can save you a lot of money and a lot of hassle, so how do you find a good mortgage broker that's going to do the best job for you?
First things first, the legal aspect. In the UK, recent changes made by the FCA now mean that mortgage brokers in the UK are required to be on the Financial Services Register. Any online mortgage broker should have their FCA registration number on the website. Checking for a registration number is vital to avoiding unqualified advice that may end up costing you a fortune and leave you dealing with the wrong mortgage product for years. The addition of mortgage brokers on the FCA register means you should feel more comfortable about working with independent brokers as you know they’ll have been subject to the same checks as a broker working for a high street bank. In Australia, legit companies will have a Australian Credit Licence.
With such a large pool of brokers to pick from these days, you’ll be sure to find someone that ticks all your boxes, in order for them to do that; you need to get a handle on what you’re expecting from your mortgage broker. Do you want a bespoke service with regular contact or do you want more of a quick digital service?
Now to narrow your search a bit further you’ll need to figure out what types of broker you’d like to work with. It’s widely accepted that there’s three types of mortgage broker:
- Brokers who search the whole of the market.
- Brokers who are tied to a specific lender.
- Brokers who look at deals from a specified list of lenders.
Just to confuse you slightly though, most ‘whole of the market’ brokers don’t actually cover the whole of the market, there’s some deals that you’ll only get if you go direct to the lender. It’s worth having a conversation with potential brokers as to whether they’d tell you if there was a better direct deal.
When searching for a good mortgage broker, remember to ask around and check reviews, if your friends have had mortgages recently they might be able to recommend a broker. It's worth keeping in mind when searching for reviews to use a 3rd party review site, brokers aren’t liking to have negative feedback on their websites even if it is accurate.
Keep in mind that you can have a chat with a whole bunch of mortgage brokers before deciding to move forward with just one of them, you aren’t obligated to continue with a mortgage broker just because you’ve had a short consultation.
Another thing to consider is the mortgage broker fees, there are ‘fee free’ mortgage brokers but in this day and age no one really works for free and usually they are paid a commission by the lender. Some people prefer to pay the broker fees themselves as they feel sure they’ve been advised of the best deal for them rather than the best commission deal for the broker.
The decision to pay a broker or find a ‘free’ broker boils down to the level of trust you have in the broker and how much you’ve budgeted for your mortgage related expenses.