Mortgage Brokers vs Comparison Sites
Comparison sites are useful as a starting point for consumers when comparing mortgage products. However, there are several limitations when applying for a mortgage through a comparison site.
In this article we explore what makes mortgage brokers and comparison sites different and what advantages you have by using a mortgage broker over a comparison website.
Let’s discover more about mortgage brokers and comparison sites.
The Cheapest Deal isn’t Always the Right Deal
On a basic level, a comparison site will fulfil the same function as a mortgage broker and source the cheapest mortgage deal for you.
That is as far as the similarities go and once a comparison site has found you the cheapest deal, it is up to you to make the application and hope everything about your situation matches the mortgage lender.
In this respect, beyond finding the cheapest deal, you are stabbing in the dark with a comparison site. There are many pitfalls you can fall into by using a comparison site to find your mortgage:
- The lender may not accept your income
- The lender may not accept your property type
- The lender may not accept your deposit source
In fact, the list of factors that can affect a mortgage application are so comprehensive it would be impossible to list them all.
This means the cheapest deal is not always the best mortgage deal for you. In many cases, the cheapest mortgage deal is not the deal that suits a client’s needs most.
Higher Chances of Your Application Declining
As a result, you have a significantly higher chance of your mortgage application declining when using a comparison site.
This is predominantly because comparison sites don’t collect enough information about your circumstances to match you with a mortgage product. Instead a comparison site tries to generalise and match the cheapest deal with your general circumstances.
When a mortgage application declines, it will impact your credit score and could prevent you obtaining the right mortgage when you find it.
A mortgage broker completes a detailed fact find about your financial situation and the property you are intending to buy. A broker will then provide advice and a mortgage recommendation specific to your circumstances. This recommendation greatly improves your chances of successfully obtaining a mortgage as a broker will match you with a mortgage product across all metrics – not just the cheapest interest rate.
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Home Buying Schemes
If you are using home buying schemes, a comparison website will always be unsuitable. This is for a few reasons but mainly because lenders have different rules when it comes to home buying schemes.
This means the result a comparison site churns out is irrespective of your desire to use a home buying scheme. Once again, this greatly increases the chances of your mortgage being declined where your situation does not meet a lender’s criteria.
Access to Exclusive Deals
You may find a comparison site advertises exclusive mortgage deals. What you may not realise is that a mortgage broker has access to a range of exclusive mortgage deals. Especially if they are a Whole of Market mortgage broker.
A Whole of Market mortgage broker with a large range of lenders on their panel will have access to lenders you will not find on a comparison site.
For example, there are numerous building societies dotted about the country that offer products directly on the high street or exclusively through intermediaries like mortgage brokers.
Building societies can be extremely useful in your mortgage search, especially if you are having difficulty sourcing a product with a high street bank. Building societies often offer products to clients that banks are reluctant to lend to, such as those with adverse credit and unusual property types.
What Our Clients Have To Say
Advice Tailored to Your Circumstances
A mortgage broker will ask you a range of questions that a comparison site will fail to ask.
When you discuss a mortgage with a broker you will be asked the following:
- Where your deposit comes from e.g. savings or gifted
- If you are employed, self-employed or a contractor
- The type of property you are looking to buy
- Existing financial commitments and debt
- And much more
Comparison sites rarely go beyond your basic income and expenditure information. As a result, the recommendation a comparison website makes may be completely unsuitable. For example, if you are self employed with only one years’ accounts, a comparison site may recommend a product that is impossible for you to obtain.
Paperwork and Comparison Sites
Once you proceed from a comparison site to a lender’s application page you are on your own. That means completing a mortgage application and providing the information required such as payslips through the lender’s portal.
You will need to sign off on everything you submit and if you make a mistake, you are liable for that mistake. It is common for applicants to be bombarded with paperwork to complete, read through and sign.
If you use a mortgage broker, you will still have a limited amount of paperwork such as checking the application and signing any declarations. For the most part though, a mortgage broker will complete all the paperwork for you and have you verify it afterwards.
Additionally, a mortgage broker will create a paperwork bundle for you so you can keep track of all the documentation relevant to your mortgage and have it to hand in one package.
Boon Brokers is Fee Free Too
Boon Brokers is a Whole of Market Mortgage, Insurance and Equity Release Brokerage, offering fee free mortgage advice and arrangement. Contact us to book your mortgage consultation today.