Going to a specialist mortgage broker, or using a comparison website – which is right for you?

Comparison websites have become a familiar first stop for many financial products, and mortgages are no exception. They promise a quick, easy way to see a selection of rates side by side. 

However, for buy to let, commercial and other specialist property finance, a comparison website are not offering the same thing. The service a broker can offer goes far beyond a comparison site, especially if you are serious about investing. What’s more, taken out of context, the information in a comparison site can be very misleading.

This guide explains how the two approaches differ, and what to weigh up before deciding which route suits you.

What is a mortgage comparison website?

A mortgage comparison website is an online tool that lists mortgage products from a range of lenders, allowing you to filter your preferences and compare rates, fees and basic eligibility criteria. 

You typically input some very top level details about your circumstances, and the site returns a list of ‘matching’ products for you to review yourself.

They are typically suitable for casual market research, when you are at an early stage of your property investment journey, or you simply want to gather information about available rates without any imminent intention to commit to a mortgage. Essentially, they are a good starting point for window-shopping rates. 

However, the reason comparison websites can be misleading is because it is not possible to input enough information about your application to return products that you will necessarily be eligible for.

What is a specialist mortgage broker?

A specialist mortgage broker is an individual or a firm that researches the market on your behalf, matches you to suitable lenders based on your full circumstances, and manages the application process through to completion. 

Specialist brokers offer a depth of knowledge of a particular area of the market, such as buy to let, commercial, bridging loans and development finance. At Commercial Trust, we cover all of these products, but we do not broker standard residential mortgages for a home you will live in.

Brokers are particularly valuable when a landlord or property investor has a clear financial strategy in place, as they can identify the lenders and products best aligned to that plan, whether the priority is maximising cash flow, securing auction purchases, or borrowing around a limited company structure.

They can also help investors who don’t have a defined strategy translate their needs and circumstances into a plan for the future that will meet their objectives.

Key differences between a comparison website and a specialist broker

A comparison website is a basic tool, where a specialist broker offers expertise and a service that takes all the work of a mortgage application off your shoulders.

Depth of comparison

A comparison website will typically show you rates from the lenders it has agreements with, based on the basic filters you select. 

These sites give you a feel for what deals are out there, but they do not necessarily provide a realistic indication of which deals you are eligible for.

Advisors at a specialist broker are trained to look beyond headline rates, factoring in fees, criteria fit, product features relevant to your specific circumstances, and other easily overlooked details that could impact a mortgage application. 

They draw on knowledge and experience of how different lenders actually assess applications in practice, which can be much more challenging than a broad overview from a comparison website might suggest.

Market coverage

Comparison websites generally only display products from lenders who pay to be listed on that particular site. This means you may be seeing a limited slice of the market, and the breadth of products displayed can vary significantly between sites.

In addition, comparison sites may not be able to cover rates exclusive to broker enquiries (unless they have a supplementary arrangement with a broker that they can direct you to). They may not be able to access certain limited edition deals, either.

A specialist broker with access to a wide range of the market, including lenders that don't have public-facing product listings, can show you products that would never appear in a comparison site search result. 

Brokers will also have their fingers on the pulse with the latest product launches and the state of the broader market. If, for example, lenders are increasing rates across the board, your advisor will be able to explain why that is happening, based on the surrounding political and economic context. 

Suitability for your circumstances

A comparison website works from the information you enter, and will typically only account for the very basic details you provide, such as loan amount, property value and rate type.

A broker takes the full picture of your circumstances into account, including details a filter can't easily capture, such as how a lender treats certain income types, how they view your portfolio if you have one, or whether your case fits a lender's appetite for your property or circumstances. 

Handling more complex cases

Comparison websites are built around standard, straightforward mortgage scenarios. If your case involves anything outside of this, such as HMOs (Houses of Multiple Occupancy), holiday lets, adverse credit, or unusual income structures, a comparison site is unlikely to be able to help you identify a suitable product.

A specialist broker works with all of these scenarios regularly, and has direct knowledge of which lenders are more likely to consider your case, and how to present an application in a way that gives it the best chance of success.

Application support

If you proceed with a mortgage application based on information gathered from a comparison website, the responsibility to apply and manage the process will fall entirely on your shoulders. 

You may have found what looks like the perfect deal, but upon reaching out to the lender, you might find that you are not in fact eligible for it, sending you back to the drawing board. Expect to repeat this process several times, especially if you have a specialist property or circumstances. It may be unclear to you what it is that makes your case out of the ordinary, and therefore ineligible with some lenders. 

A broker has the tools, skills and experience to cut through all of this. Your consultation with them will answer all the questions lenders will ask, so they can drill down their lender search to a specific group you are eligible with. A broker will then identify from that group of lenders, which products meet your objectives, whether that is lowest rate, fastest turnaround time, lowest overall cost, accepting of adverse credit, or any other features you want or need.

With a comparison site, you will have to send all your documents, unchecked by the eye of an expert, to the lender. If there are any mistakes on the document, the process will be delayed. Some lenders do not look at correspondence you send them the same day, some take weeks just to look at it, so you can imagine how long the to and fro might take as you move towards completion.

There are in fact multiple touchpoints with a lender in the process of applying, and a broker manages your application from submission through to completion. 

If your case is more complex, your advisor can contact multiple lenders to check if a property or circumstance on the edge of lender criteria would be accepted, before determining which one is the best fit for you. This will help you get the most competitive deal possible for your situation.

A broker will check the documents a lender requires from you before sending them on, to mitigate the risk of errors and time delays. 

Beyond the lender, your broker will liaise with estate agents (where applicable) and solicitors on your behalf, keeping you updated at each stage. This takes a huge volume of tedious admin off your shoulders, allowing you to focus on other things.

Costs

Comparison websites are typically free to use for the individual searching, as they're generally funded by the lenders who pay to be listed.

However, don’t forget, if you apply direct with a lender, the first job that will be done is the valuation. This is often charged to you. If the valuer discovers something about your property that you were not aware you needed to mention to the lender, and it puts the property outside that lender’s criteria, you will lose any valuation cost you have paid with nothing to show for it.

Specialist brokers often charge a fee for their service, in addition to any procuration fee paid to them by the lender. However, access to exclusive rates, time saved from avoiding wasted or declined applications, cost mitigation from applying with a suitable lender can offset their fee, particularly in more complex cases. What’s more, the drain on your time and energy in processing an application is avoided.

When a comparison website might be the right choice

A comparison website may suit you if:

• Your circumstances are simple and straightforward, such as a standard residential buy to let purchase with a clean credit history.
• You are comfortable researching lender criteria and managing your own application.
• You are confident you can process requests for documents accurately.
• You are prepared for uncertainty around lender turnaround times.
• You mainly want an initial sense of the rates available, before deciding your next steps.

When a specialist broker is likely to add the most value

A specialist broker is likely to add the most value if:

• You want to see products from a wide view of the market.
• You want confidence that the product you apply for has been assessed against your full circumstances.
• Your circumstances fall outside a standard mortgage scenario.
• You want an expert to do all of your due diligence for you based on your needs and circumstances.
• You want help from an organisation who can get underwriter feedback from a lender pre-application to mitigate the risks of a failed application.
• You want to have a clear idea of the timeframe lenders typically work to.
• You don’t want the stress and work of processing a mortgage application.
• You want the support of someone who can step in if challenges arise.
• You want ongoing support managing your property/portfolio of properties.

How Commercial Trust can help

At Commercial Trust, we specialise exclusively in buy to let, commercial, bridging and development finance, which means: 

We have:

• Broad market access, including exclusive rates not listed on public comparison sites.
• In-depth understanding of lender criteria across the specialist finance market, so we can match your case to the lenders most likely to accept it.
• Experience with complex cases, including large portfolios, borrowing with adverse credit, holiday lets in unusual locations, and much more. 
• A dedicated team managing your application from enquiry through to completion, so you're not left navigating the process alone.

What’s more, we offer the best of both worlds, if you simply want to get an idea of available rates, our website has numerous specialised mortgage calculators that provide suitable products from all of the lenders we work with:

Standard buy to let mortgage comparison table

Limited company buy to let mortgage comparison table

HMO mortgage comparison table

Holiday let mortgage comparison table

We also offer calculators which give illustrative product costs, based on current available deals:

Bridging loan calculator

Commercial mortgage calculator

Development finance calculator

If you'd like to see what's genuinely available to you across the market, rather than just what's listed on a comparison site, get in touch with our team today.