Who are the biggest mortgage lenders in the UK?

When comparing mortgages, you might seek out a deal from the biggest and best-known mortgage lenders. However, the mortgage market is highly competitive and some of the smaller and lesser-known lenders could have better deals, depending on what you’re looking for.

The largest mortgage lenders in the UK

When it comes to the largest UK mortgage lenders, not all of them have a full range of mortgage options.

When we talk about the largest or biggest mortgage lenders, we are usually speaking about those that have a history of lending the most money.

In the UK, the largest mortgage providers are:

This corresponds to the list of the UK’s ‘big four’ banks: Lloyds, Barclays, NatWest and HSBC.

Biggest mortgage lender or specialist mortgage?

Specialist mortgage lenders usually hire people who are experts in dealing with specialist and unusual circumstances, such as mortgages for freelancers or those with a limited credit history. They are likely to have experience in lending to those people and therefore have better knowledge and understanding of the risks.

This means that when you apply for a mortgage from a specialist provider, they may be more likely to assist you.

On the other hand, the biggest mortgage lenders have larger sums of money available – to those people they approve. 

They are also likely to be less risk averse than other lenders, and therefore more calculated and thorough when checking to see whether your application should be approved.

Finding and comparing the best mortgages

Comparing mortgages is complicated and it can take many hours of searching to find a good deal. Even when you eventually find one, it’s hard to know whether that deal really is good enough.

More importantly, how can you be sure that any deal is actually going to be suitable for you and your circumstances – not just now, but in the future, too?

The short answer is that you can’t ever really be sure of that. Finding a mortgage, whether you do it alone or through a broker, always requires careful planning, no matter what type of lender you use. 

Comparing mortgages with a broker

Speaking to a mortgage broker might be your best option. A mortgage broker can make things slightly easier than, say, simply going into your current bank and asking for a mortgage. Banks are unlikely to be impartial because they want you to commit to borrowing from them, rather than one of their competitors.

Mortgage brokers, on the other hand, are bound by financial regulations that require them to help you find a mortgage that is suitable for you and your circumstances.

If something goes wrong with your repayments and it can be proved that it was due to its unsuitability, the broker can be held liable for recommending that particular mortgage.

Before speaking to a mortgage broker, check whether they are what is called whole of market – meaning they cover everything on the market. It’s also worth checking how they are paid for their services. Some charge a flat fee, but others are free-of-charge because they take a commission from the mortgage lender, instead.

Lending criteria

Along with a credit check and your deposit, mortgage lenders look at your salary and bank statements to learn about your monthly outgoings.

So, if you have a monthly gym membership or even a Netflix account, that might end up being factored into your application and ability to pay back the mortgage.

The type of mortgage you want is also a factor in deciding which bank you choose. Some banks have better deals on fixed rate mortgages, while some have good rates on tracker or variable rate mortgages.

Additionally, you may have special personal circumstances, such as a low or bad credit rating, or be self-employed or older than 60 – all elements that are likely to make it harder to borrow – which could limit the type of bank or mortgage lender you speak to.

Mortgages for bad credit or self-employed workers

Unfortunately, the biggest mortgage lenders are usually not the best for people with a low or bad credit score. The same goes for those who are self-employed or do not have a regular income.

Although all banks and mortgage lenders are bound by stringent financial capability assessment checks, the bigger lenders focus on the most common types of borrowers, i.e. people with good credit scores and stable, reliable incomes.

So, if you have unusual financial circumstances, it might be difficult to be approved for a mortgage, but you can improve your chances when you look for a specialist lender.

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