Traditionally, getting a mortgage was hard work. Firstly, finding a mortgage deal that was right for you involved using a mortgage broker. This was often costly, time consuming and only brought back a handful of options. The growth of the digital age has helped to make the mortgage application process much less painful than what it previously was.
Online mortgage brokers can search almost the entire product market, bringing back a wide range of deals that are perfectly suited to your personal circumstances. They can do this within minutes, replacing the days of filling out piles of paperwork and waiting weeks for offers to be presented to you.
With almost everyone using digital financing and banking apps, applying for mortgages online seems like a natural step in the house-hunting procedure. Bringing mortgage application into 21st century, it is clear to see why online mortgage brokers are becoming increasingly popular.
What is a Mortgage Broker?
A traditional mortgage broker is the middleman between the customer and the lender. They advise on the best kind of mortgage deals for personal situations, search for the lowest interest rates and process mortgage applications. As well as this, they are on hand to answer a question or queries you may have – mortgage can be very confusing at first.
For first time buyers, a mortgage broker is usually recommended by an estate agent. Be wary of this, however, as these brokers often charge unnecessarily high fees. Traditional brokers will charge for their services in different ways. Some may not charge you upfront at all, but instead will take a commission cut from the lender once a deal is struck with the customer. Others could work on a day or hourly rate, take a percentage of the mortgage borrowing amount or simply charge a flat fee. The average for this is around £500.
What is an Online Mortgage Broker?
Online mortgage brokers can do everything that a traditional broker will do, they just simply streamline the process. Websites such as Habito and Trussle will ask you to enter your financial and personal information, before they search from over 70 lenders to present thousands of products. Ranging from tracker mortgages to fixed-rate deals, these sites ensure that unbiased and impartial offers are accessible to all customers seeking a mortgage this way.
This user friendly and more efficient procedure uses statistical data to evaluate different mortgages, after consulting remotely with verified officials. They match your unique requirements with deals to suit them, saving you time wafting through products that are irrelevant. If you opt for an online mortgage, these sites will also monitor the market throughout your repayment period and let you know if a better offer is available. The longwinded process of filling out paperwork, waiting weeks for numerous officials to check the credentials and the finally gaining a mortgage deal is replaced by an easier way.
The Benefits of Online Mortgage Brokers
As previously stated, online mortgage brokers are a simpler way to search the market for your perfect product. Less time consuming and much less of a hassle, it is easy to see why so many people are switching to this method.
The benefits of online brokers heavily outweigh those of a traditional broker. Here are the main advantages of taking the digital road to owning your own home:
- The internet does not have set hours in which it works. These online broker websites are available to you 24/7, meaning if you lead a busy life you can fit your search into your schedule. Traditional brokers usually work between the hours of 8am and 6pm, which means you can only contact them within those set times. Also, usually traditional brokers will have you set meetings and call times. Essentially, you are fitting into their schedule. With online brokers, this is the other way around.
- You might be thinking that there is not as much help to hand when you choose to search for a mortgage deal online. Yes, it might be true that for some it is easier to pick up the phone and speak to your broker directly. However, most of the popular mortgage broker sites have a built-in chat service upon which you can speak to a qualified professional about your queries. As well as this, a lot of the sites have access to a phone number, if you want to discuss important aspects of your mortgage or your application.
- Taking the traditional route to gaining a mortgage can take time. It can be weeks before a mortgage broker can gain a handful of offers to present to you, which may not even be personalised to your circumstances. Should one be of interest, the next step is filling out mounts of paperwork and waiting another couple of weeks for it to be checked by a number of officials. With all this, it is not even certain that the offer will be accepted.
- Online mortgage brokers can doall this within minutes. Entering your personal information only takes a matter of moments. The advanced technology will then search across thousands of deals from over 70 lenders. This process shaves weeks off the mortgage application process.
- Online sites such as Habito can also return mortgage products that are extremely personalised to your situation. Whether that’s how much you can borrow dependent on income, or the type of house you’re looking to buy, online brokers will only provide results that are completely relevant. This can help to save time and effort when looking for your ideal mortgage.
- As well as saving you time, online brokers can also save you money. Most traditional brokers will charge a fee, which can be anywhere up to £500, for their service. Whilst going through a broker can save in the long term, the short-term expenses can be a negative for a lot of customers. As of 2017, all online mortgage brokers offer their services for free. They can do everything that a traditional broker does, saving you not only money in long run, but in the short term as well.
- Once you’ve completed the application and your mortgage is underway, most online brokers will also track the market throughout the repayment process. They can let you know if there are better deals available, ensuring that you are never overpaying. This is especially useful when you’re coming toward the end of your initial agreed repayment term. Instead of switching to your lender’s Standard Variable Rate (SVR), using the online system can suggest the best deal to change to. Your own personalised login will also help to keep an eye on repayments, which is especially advantageous if you’re on a tracker rate mortgage. This will keep you alert to any increases or decreases in your repayment costs.
With this, it is easy to see why so many people are moving from traditional mortgage brokers to online. In the digital age, it makes sense for this to be an option. Making the whole process simpler and quicker, losing the aged paperwork and gaining personalised deals within minutes. With online mortgage brokers saving you both time and money, it’s a bit of a financial no brainer.