The emotional toll of mortgage hunting also shouldn't be underestimated
Amy Kadir (pictured), of Lonsdale Mortgages, knows all too well the challenges first-time buyers and homeowners face in navigating the complex mortgage landscape, especially those opting for a DIY approach.
“The mortgage market is very complex," she said, emphasising that understanding lending criteria, product types, and affordability calculations is far from straightforward. This complexity often leads to rejection, frustration, and delayed timelines for those venturing out on their own.
Kadir shared a scenario of a self-employed buyer, highlighting the pitfalls they face without professional guidance.
“If you’re self-employed, people think, I take X amount of salary and dividends per month and that’s my income. But actually, it’s not based on what you’re currently drawing; it’s based on income taken in the most recent tax years.” Such nuanced criteria underscore the need for experienced advisors who can parse through lender requirements and match clients to suitable products.
"We know about different types of income different lenders will take into account for lending. We know what the rates look like from across the whole market," she explained, adding that brokers have access to exclusive products unavailable to the public.
The emotional toll of mortgage hunting also shouldn’t be underestimated. Kadir recalled a client who initially approached their bank directly for a competitive rate. Two weeks later, overwhelmed and stressed, they returned, asking her to take over.
"He came back to me and said, 'It’s just too stressful. I don’t have the time to deal with them. Can you just do it for me?'"
For Kadir, this anecdote reflects a broader truth: brokers not only simplify the technical process but also alleviate stress by managing documentation, lender communications, and timelines.
Beyond first-time buyers, Kadir also addressed refinancing complexities, noting that borrowers often misunderstand lending criteria and miscalculate their borrowing capacity. Multiple rejections not only harm credit scores but also dampen morale.
"If you’re doing it yourself, you could go to a lender and get rejected, then go to another lender and get rejected—all without explanation,” she said.
As the mortgage market grows more competitive and diverse, the advantages of working with a whole-of-market broker become increasingly evident. Kadir stressed the importance of access to niche and specialist lenders, especially for clients with non-standard income streams like foreign currency or self-employment. “Everyone’s different, whether it’s complex credit history or specialist property types. We research all those lenders to find you the appropriate product,” she said.
Economic picture
The broader economic context further complicates decision-making for borrowers. With interest rates fluctuating and government fiscal policies in flux, borrowers often rely on brokers to interpret these dynamics. Kadir noted that while Bank of England rate cuts might intuitively suggest lower mortgage rates, the reality can be quite different due to factors like swap rates and global market volatility. “The base rate is expected to come down, but it’s not going to be as severe as the market was originally expecting,” she said, pointing out the need for professional insights.
Lonsdale Mortgages has also embraced technology to streamline client experiences, particularly in response to the pandemic. Its personal finance portal allows clients to update their information, securely upload their documents and track progress, combining the convenience of DIY tools with the reassurance of expert oversight.
"It’s a secure portal, and we can share mortgage illustrations and offers and communicate via secure messaging," Kadir explained. This hybrid approach caters to tech-savvy clients without sacrificing the personalised service that remains a hallmark of their business.
Yet, despite these advancements, Kadir remains sceptical about the viability of a fully DIY mortgage process for most clients. From understanding eligibility criteria to managing the emotional weight of a large financial commitment, the stakes are high.
“Start early, look at your circumstances, and get professional advice to put yourself in the best position to get the most favourable mortgage that is suited to your circumstances," she urged.
The truth about brokers
The narrative that brokers are merely intermediaries collecting commissions is one Kadir firmly disputes. She positions brokers as client advocates who navigate an intricate market to secure tailored solutions.
“We’re working for the client, not the lender,” she added.
