Look at how many lenders are on the broker's panel. It is important for your chosen mortgage broker to have access to all the main lending institutions, including the big four banks, second-tier lenders and credit unions.
It's usually more beneficial to get a home loan through a mortgage broker than directly through a lender or bank. Mortgage brokers are a one-stop shop that are able to provide you with many more lending options than just your everyday bank.
A mortgage broker is essentially a middleman between you and the lender. They assess your finances and borrowing power, then come up with a list of home loans for you to choose from.
When you're ready to take on a home loan, you can visit your nearest bank or credit union and put in an application, right? You may be approved, but it will be a general approach and potentially could cost you more in the long run. Getting a home loan isn’t easy and getting one suited to your personal situation is even harder. Enter your new best friend: an experienced mortgage broker.
The benefits of a mortgage broker are no secret and over 70% of Australian homebuyers see a mortgage broker for their home loan. Let’s explore in more detail…
A mortgage broker deals with multiple lenders offering a smorgasbord of home loan products and acts as a go-between for lenders and borrowers. Most brokers will have access to approximately 90% of the 1800+ home loans on the market. They are experts on the different types of loans available, how different lenders work and what their requirements are before they agree to the loan. They can sift through all these mortgage products for you, recommend those they feel best suit your needs and help you through the gauntlet of the lender’s requirements, so you secure the loan. A mortgage broker helps you find the right type of home loan for your needs.
Usually nothing! Most brokers are paid a commission by the lenders they deal with. However, some brokers charge fees instead of or on top of their commission so check first to find out their fee structure – it will really depend upon the services they provide. As with any advisor, shop around until you find the person you feel most comfortable with – that is, one you feel has the greatest knowledge and your best interests at heart. Look for someone with experience who understands the industry and who listens to what you are after.
You need to clearly explain to the broker what your financial situation is currently and what your plans are. The broker will assess your situation and work out the maximum home loan a lender is likely to allow you and calculate other upfront costs you will need apart from a deposit, such as stamp duty and legal fees.
Your broker will then work out which lender(s) and home loan product(s) are most suitable and guide you through the application process. It’s important to be upfront with him or her about any financial problems in your past that might lead to your application being rejected.
The lender’s credit assessor will check your credit file for the past five years. If they see that you were late with any other loan or credit card payments for a period of time, they may interpret this as you being irresponsible with money, so make sure you honestly explain to your broker the circumstance which led to any late payment issues so he or she can fill in your ‘story’ for the credit assessor in a more positive light.
Once your loan has been pre-approved by a lender, you can jump up and down with joy and hug your broker. Your broker will continue to guide you through the process until the settlement of your purchase and can offer guidance on other products you may need such as loan protection insurance.
A knowledgeable, industry-savvy and genuinely helpful mortgage broker can save you a great deal of time and money, not just with your first home purchase but for subsequent home loans and investment loans in years to come.
So take time finding a broker you can trust implicitly, who explains everything clearly in simple language and will go the distance to set you up securely for the future.
Whether it's that new house, refinance of your property, dream car, caravan, boat or motorbike, reach out to us today!
2023 / Mortgage Brokers Co. Jackson McCarthy is a credit representative (488785) of BLSSA Pty Ltd ACN 117 651 760 (Australian Credit Licence 391237)