What Does A Mortgage Broker Do?
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What Does A Mortgage Broker Do?
Charles Breen introduces the company and talks us through the services offered by a mortgage broker.
What does a mortgage broker do?
We start by listening to your situation and learning about you. Then we see what you can borrow, and verify what you can afford by looking at your income and expenditure.
It’s not just multiplying your income by four and a half, as it was traditionally. We also look at your outgoings to see what’s going to be more suitable for you.
Once we’ve identified the right mortgage lender and a suitable deal for you, we would get you a Decision in Principle. You would then look at houses, if you’re not remortgaging, then we would submit your information and get you your mortgage offer.
It’s not just organising a mortgage. We also look at home insurance, life insurance and income protection – because it’s not just about getting you this large loan. It’s also about making sure you keep your house.
We want to keep that relationship with you up until your mortgage completes in 20, 25 or maybe 35 years. It’s not just a one-off transaction. It’s a long-term relationship, where we watch the market to get you the most positive products out there and try to save you money.
What is the difference between going to a mortgage broker like yourself versus your local high street lender?
We are able to shop around on your behalf, looking at the best rates with the most suitable
lender based on your circumstances.
One of our advisers recently left Nationwide to join us. The process there was that a customer would call in, speak to a customer service operative and spend an hour on a phone. If you get past those gatekeepers, you then speak to a mortgage advisor. They would have a two hour appointment with you and at the end they would suggest a product for you.
Then they would book you in for an hour-long protection meeting. So in total you spend four or five hours with one lender. But that still might not get the best rate for you.
Usually we can encompass it in about an hour and a half. We go through that whole process in one go. That saves you time, and also we’re able to shop around.
Another advantage with an advisor is that once you get your mortgage offer, we still take care of you. We keep on looking at rates and will move you to another product if rates drop. With a bank, once the mortgage offer is issued, there’s no going back. You have to proactively do it yourself.
We’ll help you liaise with solicitors and push through the sale – and the same with estate agents. Your bank won’t – once the offer is issued, they are more or less done with you unless you chase them.
If you’ve got quirky criteria or you’re a higher risk profile, your high street bank usually won’t be able to deal with you – whereas we can work with specialist lenders. Some are big players in the industry who lend large amounts of money, but you wouldn’t have heard of them.
Generally, we like to be in control of as much of the process as possible. We take away a lot of stress and give you a tailor-made service. If it goes smoothly for you, you’ll have a brilliant client journey and you’ll sing our praises to everyone. That’s what we want and it’s the best outcome for you possible.
What services does a mortgage broker offer?
We get you a mortgage, as the name suggests. But we also liaise with other professionals like surveyors, solicitors and estate agents. We have strong relationships with them locally and we know how to deal with them.
We’ll get you an Agreement in Principle, whether you’re a First Time Buyer or a home mover. We’ll also make sure that you are protected – so that if anything were to happen to you or one of your loved ones, there’s something in place to make sure you stay in the house.
We also look at remortgaging. It’s a lifetime relationship. We do Buy to Lets, we can refer you for advice on commercial mortgages and on pensions and investments. We look after your long-term financial wellbeing.
How important is mortgage protection?
There are new ‘duty of care to the customer’ rules from the FCA and we’re putting a massive emphasis on making sure that we have a conversation about protection with absolutely every customer.
At the end of the day, you’re taking out a very large loan and we need to make sure that you are protected. If the worst was to happen, it means you can pay back that loan and stay in your house.
This is not an Amazon transaction where it’s one click and you’ve bought it. There are a lot of checks and balances to make sure that you’re being given advice – it’s not transactional. You need to go into this with your eyes open, knowing the pitfalls and that you’re taken care of if the worst happens.
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When should I see a mortgage broker? At what stage in that process?
As soon as possible. As soon as you’re thinking about buying your first home or moving. We can sit down, look at what you can afford, how much deposit you need. We’ll check your credit is in order before applying for a mortgage.
You might be better to pay down some debts first, or to take time to get your deposit together – in which case we plot out a little roadmap so you’re in the best position possible when you do want to purchase. Then in three, six, nine or 12 months’ time you’re as mortgage ready as possible. You’ll look like a pristine client in the lender’s eyes.
Last night I talked to a client who’s just thinking about possibly moving. They wanted to know how much they could borrow, so I gave them some figures so they can decide if it’s going to be worth it. It’s not just about how much they can borrow, but how much it will cost on a monthly basis. Now, they can make an informed decision.
That’s much better than going to see a house, making an offer and finding you can’t borrow enough, or that it would be too expensive on a monthly basis. You have to make those payments every month. It’s not like a Netflix subscription that you can turn on and off.
Banks deal in black and white and they have strict criteria – you need to make sure you fit and look pristine so that you get your mortgage offer as quickly as possible. Speaking to a mortgage adviser puts you in a much better position.
Does it cost for an initial consultation with you?
No – our initial consultation is completely free. We’ll talk to you, find out your situation and give general advice. Then it’s up to you if you want to progress to the next stage. We’ll actually go as far as getting a Decision in Principle for you completely free.
Then you know if you’re going to be mortgageable. After that, you can decide if you still want to work with us, and if you do, brilliant, we’ll keep building up that relationship.
Why is it so important to talk to a mortgage broker?
We can give you tailored advice – especially in the current market. You need advice in this day and age because it’s becoming so much more complicated, plus there’s so much volatility at the moment. There is only so much youtube can teach you, for some things you need an expert.
When was Montgomery Financial founded and how long have you been in the industry?
I’ve been in the industry for nearly five years. I graduated university years ago and became a teacher. At the time Ireland had gone over its overdraft a little bit and there were no jobs.
So I left to go and work in a place called Peterborough – I didn’t know where it was in the country, but I taught there for about seven years. I was rising up the ladder but was becoming disenchanted. One of my friends was a mortgage advisor and saw some potential in me, that I had the right skills to be a broker.
I did the exams while still teaching, then became a self-employed mortgage advisor in a large estate agency in Northamptonshire and became one of the top performers.
After a few years of doing well I began getting frustrated, because I have a small son, Monty who is now five. He was three at the time and I was working 60+ hours a week and never getting to read him stories. Family time is really important to me.
So in January 2022 I set up Montgomery Financial. In the estate agency role I felt like clients were a cog in a machine, whereas I wanted to have much more of a relationship with them.
We started off in a small office and ten months later I took on my first member of staff as an admin. We’ve now set up a high street mortgage shop in April and have taken on other advisors. We’re growing steadily and it’s been quite a journey.
What’s your approach with clients?
With First Time Buyers and others that are unfamiliar with the mortgage process, I think my skill set as a former teacher really helps – I’m able to break things down from complex to simple. I very much believe it’s about educating clients so they can make informed decisions. That way, they’re empowered and they know exactly what they’re being given.
When I did my first mortgage I was literally just handed an illustration of a 35 year mortgage on a fixed rate. There was no education about it – there was no discussion about whether to choose a 30 year term instead, or a 40 year term, or different types of mortgage. It was a cookie cut model, with set insurance. It was very transactional with no consultative approach.
So when I set up Montgomery Financial I wanted to change that completely and educate people. Now, we have clients for life because we provide a service to them. It’s not like going into a shop and just buying a product off the shelf.
When I do a mortgage for someone and they recommend me to their friends, I’m so pleased to have done a good job. That client is putting their own reputation on the line to recommend me to family and friends. So it means I’ve done a brilliant job and that’s the best feeling in the world.
It’s amazing too when someone has gone to a mortgage advisor and been told they can never get a mortgage – yet we manage to get one pretty much straight away. That’s also a great feeling. But there is an option for pretty much most people. That’s what I’ve discovered.
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up with your mortgage repayments.
You may have to pay an early repayment charge to your existing lender if you remortgage.
The Financial Conduct Authority does not regulate most Buy to Let Mortgages.