As a person who has been in the financial services industry since 1998 and worked as both a Financial Adviser (advising on Pensions & Investments) and specialising in mortgages since 2013 I often come across people really unsure on how to choose the right broker for them. I hope to share some insider knowledge on this here......
When you’re searching for a Mortgage Broker there are 3 main issues to overcome:
Working out the difference between a ‘Broker’ and an ‘Adviser’
Working out who’s good.
Finding a Firm (or adviser) that is knowledgeable about your specific requirements & who is going to work with you in a way that suits you.
1) What’s the difference between a ‘Broker’ and an ‘Adviser’
This is a question we get asked often and the truth is, there is no defined official answer. Not formally anyway, so I will share my opinion on the question.
An ADVISER is a person who works normally for one lender or a small panel of lenders. Their job is to advise on mortgages, not necessarily to ‘Broker’ a deal between the client and the most suitable lenders. So for example, you might have a mortgage adviser in your local bank branch, but that adviser can only advise you on that bank’s mortgages, not any other bank or lenders.
A BROKER will give you advice on mortgages, just like an adviser, but they will also be able to broker a deal between you and a much wider number of lenders, usually including most of the high street banks, challenger banks, lesser-known lenders and building societies.
In my experience, sometimes a person who can broker a deal will call themselves and adviser as they prefer the term feeling it is slightly more friendly sounding, but rarely does someone who has very limited lenders/only on lender call themselves a Broker.
2) Working out who is good.
This is a conundrum for any one, no broker or adviser would ever tell you there are rubbish right? So, how do you really get an idea of who is good?
A.) Look up FCA Registered Firms
All firms offering regulated mortgage advice should appear on the Financial Conduct Authority Registered Firms register. Some firms will be Directly Authorised by the FCA and others will be appointed representatives of ‘Principal firms’.
B.) Check out the advisers themselves
Typically, firms have advisers who are qualified & experienced. The important qualifications to look for are:
CeMAP Professional / CeMAP Advanced Professional – These show more than just the minimum mortgage exam passed but show a commitment to continuing professional development & a code of ethics. Click here to search the London Institute of Banking and Finance register of professionals to ensure your professional is registered and active.
Cert CII (MP) / DIP PFS – These show more than just the minimum mortgage exam passed but show a commitment to continuing professional development & a code of ethics. Click here to search the Chartered insurance institute & Personal Finance Society register of professionals.
Remember - It is perfectly acceptable to ask your adviser to confirm which exams they have sat, You may even find this information on their profile on the firms website.
Check if the adviser/Broker is registered personally on the FCA register here. This will be Directly Authorised firms Brokers only as part of the Senior Managers and Certification regime and will show your adviser and their qualification requirements & professional memberships. Let me stress there are plenty of other great advisers and brokers that are not individually FCA registered as they operate under a Principal firm rather than Direct Authorisation. So after completing your research, if you do find a firm/Adviser/Broker you love that isn’t registered, then feel free to give them a try.
C.) Ask Around (Friends, Family, Colleagues, IFA’s or Accountants )
This is far from bulletproof (I have many clients who I have worked with following a bad experience with a previous recommended adviser, sometimes even family members), but friends, family and colleagues are definitely worth asking.
3) Finding a Firm (or adviser) that is knowledgeable about your specific requirements & who is going to work with you in a way that suits you
Now that you have created a shortlist now it’s time to put Google to work.
Google each firm and take a look at their website. The aim of the initial website search is to rule firms “in” or “out” based on what you find there.
Some of this might be gut feel and that’s ok for now. As you look at each site, ask yourself:
What’s your first impression?
Do they mention who they specialise in, or work best with?
What can you learn about the team? Are they well qualified & FCA Registered? as mentioned earlier, the two important qualifications to look for are CeMap Professional & Cert CII (MP). On their own qualifications are not reliable as a selection metric either, but if you’re loving other aspects of the firm, then a well-qualified team with active professional memberships is definitely more supporting evidence.
Do they provide services that you think you might require?
Are there any helpful videos or blogs or hubs that you can take a look at to get a better “feel” for the firm and the people in it, who you may be dealing with?
Personally, we believe this kind of material is really valuable. Reading or viewing it can help you ascertain a lot more information in your evaluation process:
Do they communicate in your language?
Is it free of jargon?
Are they exploring issues that are relevant to you?
Are they Giving you something?
Do you get the feeling you will only find what you need if you call?
Do you get the feeling they are there for YOU?
As a result of your Googling and considering some of these questions, you’d expect to refine your possible firms down to a final few.
By Now you should have a shortlist of Firms you would consider working with based on your research. Now it is time to reach out, but don't worry - You do not need to commit at this stage:
If you’ve narrowed your search down to say 2 or 3 likely candidates, it’s time to reach out and have an initial call or Zoom conversation. Do that in whatever way works best for you - e.g. drop them an email, live chat or give them a call.
And although you’re reaching out, this is still part of your initial evaluation and selection process. You’ve not yet decided to work with any of these firms.
Be mindful that they’ll probably want to set up an initial telephone call or Zoom chat with you. Many firms will position this as the “Initial chat” or “initial conversation”. It’s much easier to talk than writing long emails back and forth and it will help the person your speaking to get a better understanding of your needs.
This initial enquiry process is also full of useful information for you to help you make your decision:
How responsive was the firm?
Were they polite and professional?
Was it easy to set up an initial call?
On the call, did they ask you any interesting questions that got you thinking differently about your situation?
On the call were they able to impart any snippets of insight or knowledge that showed you ‘they know their onions’?
Did they take the time to understand you and your priorities?
On the call did they answer your questions and address any concerns that you raised?
On the call did you get the impression that they could do the job?
On the call were they ‘pushy’ or did you feel that you were being sold at?
Was the call about you, or them hitting their targets?
When you finished your call did you feel that YOU were their priority?
Were they able to handle tough questions like information about their qualifications/experience/area of expertise/history
Where they honest and upfront with you. Did they let you know any possible hurdles in your situation?
Did they explain the lenders they have access to?
If you are comfortable and ready to make a decision, go right ahead. If you feel you need a little more to decide, head over to our home page for the guide on choosing the right broker document download for some further steps.
Also, remember its good to talk and the Balanced Team are on hand to answer your questions and help support you on your property purchase Journey
This information does not constitute mortgage advice and is merely a blog post of opinion.