Why Should Always Choose a Regulated Mortgage Broker for your Bridging Loan

When people are looking for short term finance to buy a property at auction or to help deal with a temporary cash flow problem within their business, it is understandable they will always look to get the best deal possible. The best way to ensure you get the most suitable loan at the best rates of interest from a reputable lender, is to employ the services of a regulated mortgage broker. 

You may well see posts on social media sites like Facebook from non regulated individuals who are offering financial advice in relation to mortgages and bridging finance. Now while the interest rates for mortgages and bridging finance products they offer may seem really attractive, the old maxim of “ when something seems too good to be true it usually is” is generally the case. More often than not, their posts promote interest rates for mortgages and bridging finance products that don’t exist. 

This is why when looking for short term finance you should always exercise extreme caution, and the best way to do this is to employ the services of a regulated financial adviser. Within this blog post we will look at the due diligence you should do before choosing your broker and the differences between a regulated and a non regulated mortgage broker. We will also highlight the benefits associated with using a a regulated financial adviser and broker. 

What is the Minimum Amount of Due Diligence you Should Carry out Prior to Making a Decision on your Broker?

Choosing the correct broker is essential if you want to get access to the best products and interest rates available when you are in need of short term finance. There are certain things you must do that will give you best chance of getting the bridging finance or mortgage that best meets your particular needs.   

Let’s face it you wouldn’t use a Solicitor or Accountant who isn’t qualified or the member of a professional body that maintains oversight of standards. So why would you use a non-regulated Mortgage Broker? That is why as an absolute minimum always complete the following broker due diligence:

• Complete a search of the FCA Register and if the broker isn’t listed don’t work with them.
• Complete a google, linkedin and detailed facebook search of the broker. And any red flags walk away.
• Complete a Companies House search and if there are numerous failed companies, walk away.
• Complete a search of the ICO Register and if not listed don’t work with them. What are they going to do with your data?
• Ask for a copy of their Professional Indemnity Insurance. A proper broker will have no issues sharing this information.

What are the main differences Between a Regulated and Non Regulated Mortgage Broker?

There are a number of significant differences between a mortgage broker who is regulated and one who isn’t. We have listed these below to highlight them and show you the risk you could be taking if you employ the services of a non regulated broker.  

A Regulated Mortgage Broker will:

• Possess industry recognised qualification such as CEMAP.
• Be Authorised & Regulated by the Financial Conduct Authority.
• Have an ICO listing and number for data protection.
• Hold Professional Indemnity Insurance.
• Have a website.
• Be able to demonstrate online reviews for customer service.
• Access the ‘whole of market’ or will work from a sizeable although ‘restricted’ panel on lenders.

A Non-Regulated Broker will not:

• Possess industry recognised qualifications.
• Be Authorised & Regulated by the Financial Conduct Authority.
• Have an ICO listing or number for data protection (most cases).
• Hold Professional Indemnity Insurance.
• Have a website (most cases).
• Be able to demonstrate online reviews for customer service.
• Won’t have access to regulated mortgage lenders. Meaning they can’t place residential mortgages or work with the majority of BTL lenders. In addition a non-regulated broker won’t have access to tier 1 and 2 bridging lenders. 

What are the Benefits of Using a Regulated Mortgage Broker?

There are a number of distinct benefits associated with using a regulated mortgage broker and that isn’t just that you get the best interest rates. Some of the other benefits are that they will: 

• Help you save time – researching the best lenders and products is very time consuming, when you use our services we not only offer specialist advice but also deal directly with the lenders for you allowing you to get on with your day to day life.

• Help Ensure you get the best Deal – Access to a panel of specialist lenders and products ensures that we will always be able to source the most suitable form of short term finance for you.

• Expert Guidance – Mortgage brokers are up to date with all the latest regulations, news and market trends plus we will take time to get to know you personally allowing us to provide you with the best solution to your specific requirements.

• Help With Paperwork – No one really likes filling forms in and with mortgages and bridging loans there are a lot of them, our team will work with you all the way and help you complete all necessary paperwork.

• Access to a wide Panel of lenders – We have access to a wide panel of specialist lenders helping ensure you get the best rates of interest and products possible.

• Better Chance of approval – Having access to a wide range of lenders who specialise in their field means that you have a much higher chance of approval when using a regulated mortgage broker. 

At Pyxsis capital our team has many years of industry experience and over that time has helped numerous c clients get the finance they needed. So, if you are in need of a professional and fully regulated mortgage broker contact the team here to find out how we can help you get the bridging loan finance you need.