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Online Brokers: The Future of Mortgages

With mortgages almost being a lifetime commitment, and probably the largest amount of money you’ll ever borrow, it is important that you understand what you’re getting into. It’s also key to find the right deal for your personal situation and finances. This is where a mortgage broker, sometimes also referred to as a mortgage adviser, steps in. They can help to clarify the various different types of mortgages, as well as advising which would be best for you. They also search the wider market for deals with the best rates, to save you doing this yourself.

Their expertise can indeed save a lot of time, but often traditional brokers will charge fees upfront as well as not always being in a position to proactively assist with case progression once your application has been submitted. The creation of the online mortgage broker in 2015 seemed a natural process with the continuing growth of the digital age. For some, it seemed that the mortgage procedure was stuck in the previous century – the online mortgage is a welcome change.

What Is An Online Mortgage Broker?

A mortgage broker is the middleman between the customer and the loan provider. They can advise on the best kind of mortgage deals, search the market and help with the application process.

As per a traditional mortgage broker, the online equivalent also searches the market of mortgage deals and reports back with the best rates. However, before online brokers were available, mortgage customers would have to go to a lender, a broker or adviser and fill out piles of paperwork just to apply for a mortgage.

The paperwork would need to be completed with absolute accuracy to pass through various officials and experts. Often, all this will lead to the application being rejected meaning the customer would have to start all over again. This process was time consuming and had many drawbacks. Now, it seems outdated with the rise of banking apps and mobile financial management.

Online mortgage broker sites can do everything that a traditional broker would do, only the system is much easier and more efficient. It has made the process of searching and applying for a mortgage more user friendly and entirely less agonising and confusing. They search across thousands of mortgage deals, often from over 70 lenders, to find the best deals matching the individual needs of the customer.

Essentially, online brokers are a hassle free way to get a home loan at the very best rate. They can also provide the same or greater aid as that of traditional brokers. Most of these sites have the option to chat to a verified professional at any time of the day.

How Does it Work?

Online mortgage broker sites use statistical data to evaluate different mortgages across the market. It only takes a few minutes to enter some personal and financial information. From here, the highly technical system can return thousands of mortgage deals within minutes. In theory, using an online mortgage broker could secure you a mortgage within five minutes, even when banks and outside lenders are closed.

Entering the information helps the sites to return mortgage deals perfectly suited to the customer, matching their unique requirements. The system will consult a number of experts remotely, returning with offers from more than 70 lenders. The best bit of this process is that the deals will return as impartial and unbiased. Sometimes, traditional brokers will not have access to the full market, whereas an online broker will – providing the best deals to completely fit your situation.

Note though that different sites will vary. For example, some will not provide information on any help-to-buy deals while others only offer re-mortgage deals.

Traditional brokers often charge an upfront fee for the use of their service, which on average is £500. Others may charge an hourly or day rate or take a percentage of the mortgage borrowing amount. Online brokers usually offer their services for free, opting for the latter option of taking a cut from lender once the borrower has completed a successful loan application.

Which Broker is For You?

With traditional brokers, most customers settle for those who had been recommended to them by an estate agent. This often leads unnecessary high broker fees.

As online brokers are usually free, this is often the largest incentive for potential homeowners / purchasers. It is advisable, much like traditional brokers, that you search the market before deciding which to peruse. As previously mentioned, different sites vary in the offers that they present. Check out various online brokers to see what results they bring back, then decide which you think is the best for your unique situation – hopefully you’ll love the Mortgages.Online site & choose to use us. 

Online brokers are great at giving an indication of how much you could borrow and to compare the best deals for your situation. With this in mind, whilst searching think about how much you could afford to pay back, which type of mortgage is right for you and the length of the initial period. This should help you decide.

The Benefits of Online Mortgage Brokers

Traditionally, handling a mortgage application involved a whole load of paper work, face-to-face meetings with lenders and brokers as well as a lot of phone calls. The invention of online brokers have made the process much less time consuming and simpler. It is more user friendly, especially for first time buyers who may find the mortgage application procedure confusing and intimidating. Clever technology makes everything quicker and more convenient.

The sites will also provide products from a wide variety of lenders that will fit perfectly with you individual personal and financial circumstances. It will deliver different mortgage types, from tracker to fixed rate, as well as comparing the interest rates from the UK biggest lenders. With the powerful search technology now available, the scan can return thousands of deals within minutes, saving you time and ultimately money.

Should you be successful in your mortgage application, online mortgages allow you to track the progress. Whilst you wait for approval on the application, you can get live updates on the development through a personal login, saving time organising and attending meetings or phone calls with lenders or brokers.

Once accepted, most online brokers arrange an ongoing mortgage monitoring system which will continue to keep an eye on the varying interest rates across the market. If they believe you could get a better deal elsewhere, you will be notified. This is extremely useful when you’re coming towards the end of your initial agreed period. Come the end of your mortgage term, most deals are automatically transferred onto the Standard Variable Rate (SVR) of the lender. Often, these come with very high interest rates. Online brokers can not only advise on a better deal, but will let you know before the end of the period. This will save you reverting to a higher interest rate & higher monthly mortgage payment before switching to a new, more favourable rate.

As well as this, choosing an online mortgage broker as opposed to a traditional broker could save you money on service fees. As previously stated, many brokers will charge a fee for their service. As of 2017, every online broker site was free to use, as they receive a procuration fee from the lender after a deal is completed with a borrower (as do traditional brokers). Many argue that using a physical broker could save you money in the long run despite costing a lot in the short term. However, when comparing this online brokers who can do both, it’s a financial no brainer.

Another question that may cross your mind is; “what’s the difference between a mortgage comparison site and an online mortgage broker?”

The main difference here is that online brokers will offer you a range of deals that are personalised to your unique situation. Price comparison sites are a good place to start for an overall judgement of what’s available on the market. However, these might not be available to everyone or for your personal situation. This is why it is better to use an online mortgage broker – they can show you the best deals for you.

An additional advantage is the fact that online mortgage brokers are available at any time of the day. The 24/7 flexibility is a major benefit, meaning you can check deals, track your application or follow your mortgage payments when it best suits you. Most of these sites will also have qualified advisers on hand at any time throughout the working day, whereas with traditional brokers, scheduled meetings and phone calls are the norm. This saves time, as if you have a question you can ask it right away via the online chat system.

Having already filled out your personal information will also help to save time, enabling the online expert advisor to focus on recommendations directed to you.

Having said this, some would argue that in fact it is easier to contact a local bank or traditional broker. They work in designated hours, meaning you know exactly when you can call. An online mortgage could be harder if you needed to arrange a face-to-face meeting or find a phone number to discuss an important aspect of your mortgage.

Why Are Online Brokers the Future of Mortgages?

Many will agree that traditional brokers have left one (rather large) foot in the past. The days of filling out paperwork and waiting weeks for feedback to be returned are over. In the modern age, pretty much anything can be achieved with the click of a button – so why aren’t mortgages?

Yes, a mortgage is a pretty big deal and speaking to an expert might seem like a must. In fact, it is a must. Which is why adding a live chat or direct access to online mortgage brokers was a necessity.

Using sites such as Mortgages.Online, Habito and Trussel can deliver just as many, if not more, products from a wide range of lenders in minutes. Using a traditional broker can take weeks just to deliver a handful of deals. Such sites can also make the idea of gaining a mortgage simpler and much less scary to those who are first-time buyers.

In a world where almost everyone is signed up for online banking, it seems like getting a mortgage needed a 21st century makeover. Personalised mortgage offers, ranging right through fixed rate and tracker rate mortgages, can be found on online mortgage broker sites. Even if you use these as a starting point, to gather information about how much you could borrow at what rate, you could save a lot of time and money. You may even be able to use this knowledge to barter for a better deal from another lender via a traditional broker.

Whether you’re a traditionalist or a digital age lover, you cannot deny that online mortgage brokers seem to be the next step for the mortgage application process. They are a much needed, innovative change that could save a lot of people a lot of money.




Laura Waller

Laura Waller has been working in the mortgages industry since 2013, joining an independent brokerage in Essex. Laura has CeMAP 2 & 3 – Certificates in Mortgages Advice and Practice. Since then Laura oversees marketing for Mortgages Online, using her experience and expertise to write articles and blogs about mortgages and related topics.

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