Mortgage Broker vs Going Direct: Which Saves You More?

When getting a mortgage, you have two main routes: apply directly to a lender yourself, or use a mortgage broker to search the market on your behalf. Both routes can work, but the right choice depends on your situation.

What Is a Mortgage Broker?

A mortgage broker (also called a mortgage adviser or intermediary) searches available mortgage products and recommends one suited to your circumstances. There are three types:

• **Tied adviser:** Works for a single lender (e.g. a bank’s in-branch adviser). Can only recommend that lender’s products.
• **Multi-tied adviser:** Works with a panel of several lenders.
• **Whole-of-market broker:** Searches all (or most) lenders. Gives you the broadest choice.

Always ask which type of adviser you are dealing with before taking advice.

Going Direct: Pros and Cons

**Pros:**

• No broker fee if your lender charges one
• Some lenders offer better rates direct than through intermediaries
• Direct control over your application

**Cons:**

• You only see one lender’s products
• You need to do your own comparison research
• Less support if the application hits complications
• May miss better deals elsewhere

Going direct works best if you already have a strong relationship with a lender (e.g. your current account bank) and know their products are competitive for your situation.

Using a Broker: Pros and Cons

**Pros:**

• Access to the whole market, including broker-exclusive deals
• Saves time — the broker does the comparison and paperwork
• Adviser has regulatory responsibility for their recommendation
• Useful if your circumstances are complex (self-employed, credit issues, unusual property)

**Cons:**

• Some brokers charge a fee (£300–£500)
• Broker-paid commission from lenders could theoretically influence recommendations (regulated to prevent this)

Broker-Exclusive Deals

Some of the most competitive mortgage products are only available through brokers, not directly to consumers. Lenders often prefer the broker channel because intermediaries submit cleaner, better-prepared applications. In a competitive market, the best rates can sit exclusively in the broker channel.

Broker Fees Explained

Most mortgage brokers are paid by commission from the lender on completion (£300–£1,000 depending on mortgage size). Some also charge the borrower a fee, typically £300–£500.

For a £250,000 mortgage, paying a £500 broker fee to access a rate 0.2% lower than the best direct deal would save approximately £500 per year in interest — the fee pays for itself in year one.

Regulation

All mortgage brokers must be authorised and regulated by the Financial Conduct Authority (FCA). Check any broker’s FCA registration on the Financial Services Register before instructing them.

Which Should You Use?

The FCA’s guidance is that regulated whole-of-market advice consistently produces better outcomes for consumers than direct applications, particularly for complex cases. For most people, using a good independent broker is the best starting point.