Why Use a Broker Instead of Your Bank?
Over 60% of UK first-time buyers in 2023 engaged a mortgage broker rather than directly visiting a bank. Access to a range of mortgage deals allows brokers to frequently save consumers thousands of pounds over the course of the loan. Knowing why brokers could be the better option for first-time buyers could save time, money, and stress. Let us investigate the reasons a broker is typically the wiser choice than handling business directly with your bank.
1. More Mortgage Choices
Banks can only provide their own mortgage products. Their range of choices is therefore restricted, thus you might pass on better offers elsewhere. Conversely, mortgage brokers deal with several lenders—some of which do not deal directly with the public.
For first-time purchasers, a broker could access discounted interest rates or flexible terms based on special offers. Statistics show that buyers using brokers can save up to £5,000 over the first five years of their mortgage, compared to those using banks directly.
2. Tailored Advice for First-Time Buyers
For those just starting the process especially, the mortgage can seem overwhelming. Confusing terms are fixed-rate, variable rate, loan-to-value ratios. A broker facilitates this by clearly and simply speaking about everything.
Brokers also know the difficulties first-time buyers encounter—such as credit history issues or meagre deposits. Their recommendations are customised to fit your circumstances, so smooth out the process and reduce anxiety. Their intention is not only to sell you a product but also to identify a mortgage that meets your financial situation.
3. Higher Approval Chances
Many times, banks have tight lending policies. You might find it difficult to be approved if your income is rather erratic or if your financial background is not perfect. Brokers, however, deal with a variety of lenders, including those that specialise in assisting individuals with non-standard situations.
For instance, a broker can help you find more flexible lenders if you work for yourself or have credit problems. Applications sent through brokers actually have a 20–30% higher likelihood of approval than those forwarded straight to banks.
4. Better Interest Rates and Lower Costs
Brokers work on your behalf. This can sometimes result in lower fees, such as arrangement or valuation charges, or lower interest rates.
Assume that you are borrowing £200 000 at the moment. A broker could assist in locating a bargain that results in 0.2% interest rate savings. However, it sounds little, over a 25-year period, that could save thousands of pounds.
5. Saving Time and Reducing Stress
Back-and-forth correspondence and a lot of paperwork characterise the mortgage process. Should you visit a bank, you will have to handle all of this yourself, which can be time-consuming and taxing.
One looks after this for you via a broker. They handle applications, negotiate offers on your behalf, and contact lenders. This can be quite relieving for first-time buyers who are busy and allow more time to concentrate on other facets of purchasing your house.
6. Ongoing Support
A broker does not vanish just after your mortgage is approved. Many brokers provide ongoing guidance, including helping you evaluate your deal after a few years to make sure you are still getting the best rates.
They can also help with things like budgeting guidance or insurance, so ensuring your long-term success is set up. Banks hardly offer this kind of continuous assistance.
Conclusion
Choosing a mortgage broker rather than a bank clearly benefits first-time purchasers. From saving money and lowering stress to gaining access to a larger spectrum of products, brokers offer customised solutions banks just cannot match.
If you are about to start down the property ladder, choose Cubic Financial Services. Expert advice and tailored service will enable you to confidently find the correct mortgage. Get in touch now to make your dream house to a reality!
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