Best mortgage lenders: to help you find the best mortgage deal

Who are the best mortgage lenders, and how do decide who to go with? Read our guide to get an idea of what to look for

best mortgage lenders
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Who are the best mortgage lenders, and how do you compare them? When you're trying to find the best mortgage deal, it's easy to focus only on the cost of your repayments. And yet, there's so much more to securing a mortgage than making sure you can afford the repayments. 

You'll need to think, among other things, about any additional fees, including exit fees, that your lender may charge, as well as about your individual circumstances. Is your income irregular, or your finances in any way unusual? How about your credit score? In this guide, we talk you through navigating the world of mortgage lenders to help you find the best one for your needs.

Ready to play around with figures already? Jump down to mortgage expert our free online mortgage comparison tool below. 

Best mortgage lenders: the bigger the better?

When you're applying for mortgage for the first time, it can be tempting to just approach your bank. In fact, the biggest mortgage lenders in the UK roughly correspond to the 'Big Four' list of the biggest banks, which includes Lloyds, HSBC, Royal Bank of Scotland and Barclays. 

Yet, interestingly, a ranking of the best mortgage lenders by Which? puts Nationwide at the top for customer service, value for money and transparency, and it's not in the Big Four. In fact, none of the Big Four banks make it into the top 10 (HSBC is at number 11). 

What does this ranking exercise tell us? That bigger is not necessarily better when it comes to mortgage lenders. Which isn't to say that you shouldn't consider your bank as a lender. For some people, the ease of just booking an appointment with their bank may well override other considerations, and, in some cases, big lenders will offer you better deals, because they have the financial capacity to do so. 

Mind, the caveat 'in some cases' is important here: we hate to admit this, but the higher your status with your bank, the better your chances of securing a good deal with them. If you have a standard account, little savings, and are often overdrawn, we wouldn't necessarily recommend using your bank as a mortgage lender. 

Best mortgage lenders: why use a specialist mortgage lender?

Specialist mortgage lenders have experience working with people who have similar circumstances to you, which makes getting approved for a mortgage more likely. This doesn't make a mortgage lender any less reputable than a big lender, it just means that they have found a niche in the mortgage market that works for them.

For example, a mortgage lender may cater more to those who are self employed (of which more below), or to people with past histories of financial problems or low credit scores. 

Best mortgage lenders for the self employed

As we explain in our guide to self employed mortgages, it can be difficult to secure a mortgage if you work for yourself, especially if you've ever had a dip in your income or irregular earnings. Again, a lender that takes on more self employed applicants will be able to tell whose self-employed income is reliable, even if sometimes irregular, and who is too high risk to approve for a mortgage.

Having said that, sometimes your bank is the best mortgage lender if you're self employed, particularly if they've helped you set up and run your business finances. They will know your finances better than anyone, so if your business is in good shape, you may well find it easier to apply for a mortgage with your bank. 

Best mortgage lenders for bad credit

This is almost certainly going to be a small, specialist lender. Do bear in mind that this doesn't mean that a lender, even a specialist one, will approve you for a mortgage if you currently have bad credit, as all lenders have to abide by the more stringent lending rules implemented after 2008. 

What they will have experience of is identifying applicants who have genuinely turned their finances around and will be able to afford a mortgage. A big lender is much more likely to just reject you outright: banks have bigger financial resources, but they are also risk averse; it's just the way they're run.

Find out more in our guide to mortgages with bad credit.

Best mortgage lenders for buy to let

It really doesn't make that much difference whether you go with a big bank or smaller lender, because these types of mortgages automatically come with more stringent acceptance criteria (read about them in our guide to buy to let mortgages). If you are letting out more than one property, however, you'll need to know whether the lender has had any experience dealing with property portfolios, which are again assessed differently from a single buy-to-let mortgage.

Best mortgage lenders: planning for the future

Say you've found a mortgage lender who is willing to approve you for a mortgage and is offering you a good deal. What if your circumstances change in the future? If you encountered difficulties making mortgage repayments, either through the loss of a job or divorce, will they offer any flexibility in how you make your repayments? And if you decide to remortgage, will they penalise you for leaving? No one buys their first home with worst case scenarios in mind, but they do happen, and it's a good idea to learn in advance what the lender's policies are.

Comparing mortgages

Ready to start making the mortgage comparison for yourself? We've teamed up with the online mortgage experts Habito: find out how much you could borrow with different lenders using their comparison tool below. Then speak to one of their experts for more free advice and ideas about how you can secure a mortgage.

Anna is a professional writer with many years of experience. She has a passion for contemporary home decor and gardening. She covers a range of topics, from practical advice to interior and garden design.