There is nothing wrong in speaking to various mortgage brokers to get their views on the latest mortgage rates – it is only natural. However, you should be cautious about appointing more than one mortgage broker to work on your behalf when you are ready to move.
Researching the best mortgage rates
At first glance the list of mortgage lenders can be huge. We now have high street banks, private banks, investment banks, specialist lenders and private investors playing a major role in the UK mortgage market. How to choose a mortgage lender may seem almost impossible at first glance but once you are clear what to look for in a mortgage it becomes easier. As an expert mortgage broker with unrivalled contacts, a depth of experience and knowledge of the UK and international mortgage market, think of us as a financial filter. What do we mean by this?
Choosing the best mortgage lenders for your situation
If you have a specific situation, perhaps complex financial requirements or you have assets spread round the world you want to use as collateral, not all mortgage lenders would be appropriate. Here at Enness we will discuss your situation in great detail, make comments and suggestions and then filter out the inappropriate mortgage lenders leaving the best of the rest. We also encourage you to talk to your regular bank to get a feel for the market, an overview of what is happening which offers the ability to compare and contrast different deal structures.
For many people a mortgage on their home will be the largest financial commitment in their lifetime. This can be a daunting task without professional advice, the ability to check the latest market trends and specific deals on offer. The vast majority of mortgage finance we arrange tends to be time critical which means there is no time to waste checking out mortgage lenders inappropriate for your needs. We will use our contacts to bring together only those who can address your situation; suggest a deal structure to save time and encourage them to come back with the best offer they can put together. We know from working with mortgage brokers in years gone by that they trust us, respect us and know we will not waste their time.
Finding the best mortgage deal can be exhausting
While the Internet is a very interesting and useful tool to check out the latest mortgage market trends it is not necessarily the best place to find a mortgage deal to suit you. Many of the private banks, challenger banks, crowdfunding platforms and private investors on our list of contacts will create a unique structure deal for you. As a consequence, when comparing the general terms and rates available on the Internet it can be akin to comparing apples and pears. So, by all means research the Internet and talk to other brokers about general market conditions but don’t take the publicised rates as set in stone. We pride ourselves on our ability to slash costs, negotiate the best headline interest rates and reduce the long-term cost of your finance.
Why do we advise clients not to appoint more than one mortgage broker?
In reality there are very few if any situations where we are not able to put together a structured personalised mortgage deal as a consequence of our independent status and access to the whole market. No matter how complex your financial situation, how irregular your income and you may potentially have collateral spread across the world, we know the best structure for you and where to find the best deals. While there is nothing wrong in talking to brokers about general market conditions and mortgage rates, it is dangerous to appoint more than one mortgage broker to look after your affairs. Why?
As we will discuss in more detail in a moment, there are a variety of different types of mortgage broker that receive income from various sources. Using a mortgage broker with restricted access to the financial markets will immediately reduce your options; reduce competition and ultimately the chance to negotiate the best deal for you.
Different types of mortgage brokers
When you dig deeper into the mortgage market you will come across an array of different types of mortgage brokers which fall into four main categories. These are:-
- Tied mortgage brokers – as the name suggest, they are tied to one specific lender such as a bank thereby restricting your options
- Appointed representative mortgage brokers – while offering a greater spread of potential mortgage lenders, even appointed representative mortgage brokers will only have access to a fixed panel of lenders
- Whole of market mortgage brokers – while the term suggests no barriers to access, a whole of market mortgage broker is only required to be “representative” of the market
- Fully independent mortgage brokers – Enness is a fully independent mortgage broker which gives us unrestricted access across the whole financial market, hundreds of lenders!
As you can see, if you were to appoint two mortgage brokers, a tied mortgage broker and an appointed representative mortgage broker, they would focus on different areas of the market. In this case, our regular access to all forms of finance, from private investors to private banks, investment boutiques to crowdfunding, would not be available to you. This is why we pride ourselves on our fully independent status, our upfront place in the market and the ability to keep on increasing the number of contacts and the depth of our knowledge.
Mortgage broker fee structure
It is easy to look at the headline fee structure for a mortgage broker and go for the “cheapest” option. However, as a general rule of thumb, if there is no broker fee (or one which is relatively low) then the mortgage broker in question is likely receiving commission from a relatively small panel of lenders. The Combined Initial Disclosure Document will cover fee structures, direct and indirect relationships with lenders and the way in which your business will be transacted. This is something that mortgage brokers are obliged to go through with you before any contract is signed.
We believe in total transparency, a flexible fee structure and are extremely confident that our knowledge, experience and contacts will lead to the best deal for you. If you have any questions or queries, perhaps certain elements of a mortgage deal is unclear, simply contact us and we will put your mind at rest.
Can too many cooks spoil the broth?
The idea of appointing more than one mortgage broker to act on your behalf, investigate the best deals and secure the best rates is perfect in theory. In practice it can be very different and could ultimately cause confusion, friction and lead to some mortgage brokers dropping out. If you think about it, if you’re mortgage broking deal is not exclusive, is it worth a mortgage broker using their skills and contacts only for someone else to cut fees to the bone at the expense of the cost of your long-term finance? As with any the market/product, you pay for quality and the best mortgage brokers will pay for themselves.
There are also the practical issues associated with more than one mortgage broker attempting to secure the best mortgage deal for you. This can lead to:-
- Very different interpretations of your circumstances and requirements
- The same proposal presented via multiple mortgage broker sources
- Different understandings of your long-term plans for the property
- Multiple searches against your credit report
- Mortgage applications for the same party based on varying income figures
We live in a world where mortgage lenders are continuously battling against fraudulent activity. As a consequence, similar proposals presented to different elements of the market and multiple credit report searches may prompt suspicions of fraudulent activity. If there is any confusion or concern, many mortgage lenders will simply drop out of the race thereby reducing competition and your ability to secure the best deal.
Once we have clarified your situation in detail, your requirements and your long-term goals, we will focus on mortgage lenders applicable to your situation. This reduces multiple applications, multiple credit report searches and due to a long-term relationship with many leading mortgage lenders, an instant degree of trust. Fraud is still a problem across the financial markets and even a relatively minor misunderstanding could see an application flagged as “potentially fraudulent”. That is the last thing you want!
Presenting your case to the right people
We fully appreciate that time is money; property deals generally need a quick conclusion as well as the need to approach the right people at the right time. Rather than going through the options with mortgage lenders we have dealt with in the past, we can structure your deal, approach lenders with a plan in mind and request the best terms for your situation. To put it in perspective, mortgage lenders prefer solutions rather than problems – this is where we come in.
Taking a scattergun approach to mortgage lending is potentially dangerous for borrowers. We have seen misunderstandings, simple errors and different interpretations of the same basic facts leading to very different deals. We present your case, your scenario and your requirements in the simplest format to ensure no misunderstandings. We know which mortgage lenders will take into account worldwide assets, we know those who appreciate income is not always regular as well as niche market players for specific complex situations. We don’t waste their time and they don’t waste our time.
So, why not get in touch with us today for a no obligation chat about your situation, your requirements and the options open to you. Whether simple or complex, we have seen it all before and our knowledge puts us in good stead to find the best deal for you.