Whether you’re buying your first home or trying to develop a property, you’re probably going to need a loan. You can secure financing through a direct lender, such as a bank, or by working with a mortgage broker. Here are five benefits of going to a mortgage broker for financing.
Mortgage Brokers Are Qualified
In order to be able to give advice about mortgages, mortgage brokers have to be qualified to do so. Although they don’t have to hold a degree, they do have to take exams to be qualified as a mortgage advisor. Brokers must pass the CeMAP, which is the Certificate of Mortgage Advice and Practice, to be able to give people advice about mortgages and to help them select the best products for their needs.
Choice of Products
Unlike bankers who only sell their company’s products, mortgage brokers are free to search for the best mortgages for your needs. They are not limited to one company’s mortgages, but can search for mortgages offering the best interest rates or terms for their customers. In addition, they can also advise their clients about payment protection insurance and other types of insurance, such as life or homeowner’s insurance.
Works for You
Since a mortgage broker doesn’t work for a particular lender, he or she can help you find mortgages based on your needs. A direct lender is only interested in selling you a product because they make a commission afterwards and they are less interested in how well it meets your needs. Mortgage brokers in Bath will find the best mortgages for you and they will even help you fill out applications to increase your chances of being approved for a loan.
Obligated to Protect You
By law, mortgage brokers have a duty of care to find an appropriate mortgage for you. If their advice turns out to be bad or misleading, then you can complain and you may be able to receive compensation. However, if you go to a direct lender, they are not obligated to make sure you get a mortgage product suitable for your needs and you have no legal recourse against them if they sell you a product you cannot afford.
Obligated to Disclose
Mortgage brokers are also obligated to tell their clients about their services, the fees they charge, and any commissions they make. They have to give their customers a Key Facts Document outlining this information and they also have to offer a Key Facts Illustration after recommending a certain mortgage product. The KFI will also detail the commission the broker will receive by selling the product to his or her customers.
Although your first instinct when house shopping may be to go to your bank for a loan, you will find more product choices by working with a mortgage broker. He or she can assess your needs and financial situation and then suggest mortgages that are suitable for you. It is in his or her best interest to find you a suitable mortgage to protect his or her career and business reputation.