Deposits, loans, lenders, interest rates, mortgage insurance… there’s a lot to think about financially when it comes to investing in property!
Of course, while it is possible to handle the financial aspect of a property purchase yourself, my recommendation is to always seek professional advice and utilise the services of a skilled and experienced Mortgage Broker.
Why? Well, simply put, you could be missing out on some significant benefits otherwise!
Usually, once the decision has been made to apply for a home loan, the large majority of people automatically head straight to their own (or nearest) bank. After all, it’s the most logical choice, right?
There are countless reasons why it pays to use a mortgage broker when shopping for a home loan, primarily because they have access to a much wider range of lenders and can help you find the home loan that is best suited to your circumstances.
And even if you do decide to go with your bank, a broker can still help you out with other aspects – such as processing paperwork and managing the application on your behalf.
Unfortunately, there are a LOT of brokers out there… and not all of them are equal! With all of them trying their very best to sway you to use their services, you need to look past clever marketing techniques and start figuring out who REALLY knows their stuff and is equipped to help you with your property journey.
There are a number of things you should consider when looking for a mortgage broker, including:
The best and easiest way to find a good mortgage broker is to ask family, friends and colleagues for recommendations of who they used and were happy with. Chances are, you’ll also be a good match!
While referrals are always great, it’s important to make sure your broker has a long-standing history of client satisfaction. Always check websites and social media for reviews
from previous clients to ensure they are consistent. If possible, also speak to them directly so you can get an idea of what their relationship with their clients is like.
- Experience & Qualifications
Did you know brokers actually have a legal ‘responsible lending’ obligation? This is to ensure that you are not being given a loan that is not suited to you. They must also give you a Credit Guide with information including their licence number, fees and details of your rights before they provide you with any services. I recommend looking for a broker that has several years experience in the mortgage industry and is also properly qualified. They should be:
- Accredited under the National Consumer Credit Protection Act
- Have a Certificate IV and preferably a Diploma in Financial Services Mortgage Broking
- Be a member of the Mortgage & Finance Association of Australia (MFAA) and/or the Finance Brokers Association of Australia (FBAA)
- Be a member of the Credit Ombudsman Service Ltd (COSL)
Pick up the phone and talk to them. Don’t underestimate your gut feeling! Do you feel comfortable talking to them? Do they give off a positive, reassuring vibe to you? Ask questions about what’s on offer and get them to explain to you why they think this product is best for you. If you’re struggling to keep up with what they are telling you, ask them to explain it in simpler terms – it’s vital you are 100% aware of what is happening.
- Ask For Their Lending Panel
If you’re not sure, ask your broker which products they will be comparing and from which lenders. Ideally, they will have a mix of both traditional lenders, such as banks, building societies and credit unions, as well as non-traditional lenders.
Asking for a comparison rate table of the different home loans you’re considering will help you see for yourself which loan works best for you financially. You should also ask for a loan product fact sheet so you have in writing what the broker has offered to you.
- Clarify Costs
In most cases, brokers will provide their services for free to lenders, and are paid via a commission by the credit providers. That being said, you should always ask your broker up front what costs are associated so that you are not surprised later!
There you have it – everything you need to know to choose the RIGHT Mortgage Broker!
Still have questions? Feel free to leave them below for me to answer.
Until next time,