What’s the Difference?
Some people just go to their existing bank/credit union to get their loan because they have been with them for years, they think it is easy and quicker, and they have all your data.
Does that sound like you? What if we can tell you about another option?
A mortgage broker is a go- between who can assist you to both source and negotiate the right deal on your home mortgage. Provide you with multiple lender options as appose to going to one bank and being offered “one product offering”. Often a broker can get you a better interest rate and better terms and conditions on your loan than the bank can’t offer you. We deal with multiple lenders and it makes NILdifference to us which lender we do the business with because they all pay us the same.
What Does a Mortgage Broker Do?
A mortgage broker is a go- between who can assist you to both source and negotiate the right deal on your home mortgage. Provide you with multiple lender options as appose to going to one bank and being offered “one product offering”. Often a broker can get you a better interest rate and better terms and conditions on your loan than the bank can’t offer you. We deal with multiple lenders and it makes NIL difference to us which lender we do the business with because they all pay us the same.
One phone call and the mortgage broker will quickly sort it out for you. Home mortgage brokers can help you with many more aspects of a mortgage than just showing you the available interest rates. They can calculate how much would be truly affordable for you. Match you to the most appropriate home mortgage product for your circumstances. Not to mention showing you strategies to save money and even how to pay off your mortgage faster.
Additionally, expert mortgage brokers follow up to review your house mortgage periodically to see if there are ways to pay it off faster. Also, whether it’s still the right loan product for you, and importantly that it’s still competitive. You won’t get that kind of service from a bank. When was the last time a bank called you to see how you were going with your house mortgage? For people who aren’t used to negotiating, who aren’t certain what the right house mortgage product is for their situation, or for those who have a less than perfect credit rating, using a mortgage broker will save time, money, and frustration.
Is your Mortgage Broker Independent?
One would easily assume that when dealing with a mortgage broker you’re going to get independent mortgage advice. However, in recent times several the larger franchised mortgage broker groups have been steadily taken over by the major banks in Australia. We would suggest if you’re looking to get independent mortgage broker advice, then ask a couple of straight forward questions when you’re seeking a broker you’re going to be comfortable with.
Questions Worth Asking:
How qualified are Mortgage Brokers?
The Mortgage and Finance Association of Australia (MFAA) was established to monitor the activities of the many thousands of mortgage brokers now operating in Australia. In addition to ensuring that brokers are operating their businesses ethically it sets the educational requirements for its members at challenging levels. The market demands for ethical and qualified mortgage professionals are growing strongly.
More than ever home owners are turning to mortgage brokers for trustworthy advice on their housing and/or business finance needs. Credit advisers (or brokers) engage with their clients to determine their specific borrowing needs, borrowing capacity, and borrowing affordability. They assist in selecting a mortgage that fits the borrower’s goals and objectives. Then manage the entire process skilfully through to settlement. Professional level mortgage brokers will have strong finance literacy skills, excellent people and customer service skills and the innate ability to closely listen to customer’s needs.
Loan brokers can also specialise in different areas such as:
Many mortgage advisers are now adding additional skills and qualifications to their portfolios and have expanded their client product services into the areas of general insurance and financial planning.
A mortgage adviser or brokerage house is required to obtain what’s known as an accreditation with a lender to represent and sell their product/s.
Most mortgage brokers/ advisers become accredited with a wide range of mortgage lenders. This is then called ‘the panel of lenders’. Mortgage brokers can only offer the loan products from the lenders that are on their panel. The requirements for accreditation vary from lender to lender, as too does the size of each mortgage adviser’s panel. Therefore, it’s well worth checking to ensure you have a good representation of lenders to choose from.
Just like many similar businesses, home loan brokers are required to carry and maintain professional indemnity insurance. The MFAA requires all its members to maintain membership in the Credit Ombudsman Service Limited (COSL), or similar Australian Securities Investment Commission (ASIC) sanctioned External Dispute Resolution scheme (EDR) or be covered by a COSL membership. This is also a requirement for all brokers under the ASIC regime.
How Should You Choose a Mortgage Broker?
You will find that the best mortgage brokers explain all aspects of the home loan application process to you clearly and easily in a way that you can readily understand.
You’re looking for your broker to return your messages promptly – ideally the same day — and always be up front and not try and “hide under the desk” per chance your loan runs into trouble for some reason.
Not all loans do settle quickly. It’s essential for maintaining a professional relationship that the loan broker gives their clients regular updates of what’s happening during the loan application process. For example, for one reason or another unforeseen problems crop up with loan applications and these situations can cause loan applications to take longer than normal to process.
