In the UK there are generally speaking 2 ways to apply for a Mortgage on your home or new purchase.
This is where you as the applicant make an application directly to the bank or building society yourself. How you do this in practice will vary from mortgage lender to mortgage lender. But generally speaking you would would either book an appointment with the bank and go through the application in branch or over the phone.
Someone from the lender would book in the appointment for you. You would then have a meeting (sometimes 2) with one of their mortgage advisers. Typically this can take around one to 4 hours from various bits I have read online. I used to be a mortgage adviser for a bank and we used to spend around 2-3 hours on the phone going through our script and the application process. It would then be passed over to a case manager who would take over after the application has been submitted.
You will then need to send in the documents such as bank statements, payslips, ID, proof of deposit and any other documents required.
The application will then be sent on to an underwriter and this is where the process generally follows what it would if you were to apply via a Mortgage broker. The slight difference is that if you want an update, you are probably calling a call centre for an update.
Applying through a Mortgage Broker
I cant speak for all mortgage brokers, but I think our process is generally a little easier than if you were to apply through a bank or building society directly.
We have an initial phone call (around 10 minutes) to get an idea of your situation and to work out if we can help. We then set you up on our system and send out a factfind to be completed.
You can complete the factfind at your leisure at home with a quick follow up call for any questions. Alternatively we can complete it over the phone together which generally takes 45-60 minutes. You can then also send over your documents via email.
We will then come back to you with some options and discuss them with you and we will then submit your application to the underwriter on your behalf.
We will deal with the underwriter and we can also deal with the Estate Agents on your behalf if you wish.
Which is better?
I will try to answer this without being biased…
Going via a broker has many benefits:
- We compare the market (around 80 lenders),
- You can get hold of your broker directly (ie no support staff, no call centres etc),
- One person from start to finish,
- We can deal with the agents and are much more accessible for questions or any little wobbles you might have.
Going directly has its own benefits:
- If there is a problem, it will be the lenders fault. So no passing the buck between broker and lender.
- You would like to think being in the company means if there is a problem, they know who to go to. Although brokers do usually have account managers within the lenders.
I think the benefits of a broker outweigh the benefits of going direct. But I can understand why people may want to apply directly. Banks are bigger companies and have a brand name. There can be a degree of more trust with what you know. But smaller companies do generally work harder for their customers as everything is a lot more personal.
However, I think 99% of the time the outcome will be the same. The difference can be the journey from start to finish.