Why Use a Broker Instead of Going Direct

Deciding whether to use a broker or go direct is one of the first steps you’ll take when seeking business funding. It’s also a decision with long-term consequences: it can directly affect how much money you receive, how much you repay in interest, and how straightforward the whole process is.

As business funding options become increasingly complex, more businesses than ever are choosing to work with brokers. In this post, we’ll cover how brokers work, what they cost, and when they’re worth using.

What Does a Business Finance Broker Do?

Business finance brokers act as the middleman between a business and its lenders, helping businesses secure suitable financial products for their needs. Rather than relying on just one lender, such as a bank, brokers have access to a wide range of lenders. That means a better chance of finding the right fit for your business.

Going Direct to a Lender vs Using a Broker

Businesses have options: they can approach a lender directly or work with a commercial finance or property finance broker.

Going direct may work if you already know exactly what finance you need and which lender is right for you. A broker, however, can compare options across a wider panel of lenders, advise on the most suitable route and help structure and present your application – particularly where your requirements are more complex.

Benefits of Using a Broker

If you’re weighing up whether a commercial finance broker is right for you, here’s what usually tips the balance.

Access to a Wider Panel of Lenders: With a broker, (Such as Elite as not with all) you get access to over 200 lenders, not just one.
Increased Chance of Approval: An experienced broker will not only match you with the right lender, but structure and present your application effectively, working through affordability and making the case to underwriters – particularly where a more bespoke approach is required.
Saving Time and Paperwork: Brokers don’t just offer business loan advice; they can handle the whole process from beginning to end.
Finding More Competitive Rates and Suitable Products: Businesses that work with brokers typically benefit from better interest rates.
Tailored Advice Based on Business Circumstances: A good broker will take the time to get to know your specific needs, ensuring you get the right financial product.
Support Throughout the Application Process: They’ll be with you every step of the way, from first enquiry to funds landing in your account.

Types of Finance a Broker Can Help Arrange

Business Loans: Boost your working capital, cash flow, or expansion plans with a business loan at the best rates.
Commercial Mortgages: Secure your working premises or invest in commercial property with a commercial mortgage.
Bridging Finance: A broker can help arrange a short-term bridging finance loan.
Property Development Finance: A specialist product, working with an experienced broker is key to getting the best deal. From ground-up developments to refurbishment projects, an experienced broker can help structure funding around your project, costs, GDV and exit strategy.
Asset Finance: Fund your business growth with asset finance that lets you buy the equipment, machinery or vehicles you need to get ahead.
Other Funding Solutions: Need something more niche, like invoice finance or a merchant cash advance? A good broker will usually still have options.

Common Misconceptions About Using a Finance Broker

Some businesses shy away from working with brokers, often not because they wouldn’t benefit, but because of one of a few common misconceptions.

For example, many businesses assume that using a broker is an added expense. In practice, the time saved on paperwork and comparison, combined with access to more competitive rates, usually means working with an experienced broker extremely valuable.

It’s also not true that finance brokers are only for large corporations. Many, including us here at Elite Business Funding, work with SMEs and growing businesses too. Take a look at some of our case studies to see how we’ve helped businesses like yours.

When It Makes Sense to Speak to a Broker Before Applying for Finance

Some situations make speaking to a broker especially worthwhile: if your needs are complex, if you’re not sure which product suits you best, or if speed matters. An experienced broker who understands different lenders’ criteria can identify suitable options before applications are made, helping you avoid approaching unsuitable lenders and giving your application the strongest possible chance from the outset.

FAQs

Do I still deal with the lender directly?

Not usually. Your broker manages the relationship with lenders on your behalf, from the initial search through to completion, though you'll still sign the final agreement directly with whichever lender you go with.

Are business finance brokers regulated?

Regulation depends on the type of finance being arranged and the circumstances of the borrower. It's worth checking a broker's regulatory status, experience and credentials before proceeding.

How long does the process take?

This varies significantly depending on the type of finance, the complexity of your application, and the lender involved. A broker can usually give you a realistic timeframe once they understand your circumstances.

Can a broker help if my business has been refused finance before?

Often, yes. A refusal from one lender doesn't necessarily mean finance isn't available elsewhere. An experienced broker can understand the reasons behind the refusal, assess your circumstances and identify lenders whose criteria may be better suited to your business and funding requirements.

Working With a Broker: Final Thoughts

Whether you’re looking for business finance or property finance, the right broker can do far more than simply introduce you to a lender. From identifying suitable funding options and structuring your application to presenting the case to lenders and supporting you through underwriting, experienced advice can make a real difference.

Looking for property finance or business finance? Get in touch with Elite Business Funding today for no-obligation advice about your funding needs. Whatever stage your business is at, we’ll talk you through the options that actually fit it.