Many Aussies find the process of applying for a home loan challenging - from selecting the right lender to understanding the lender’s mortgage criteria. By consulting a home loan mortgage broker, you can take advantage of their experience in dealing and having a relationship with a variety of lenders. If you’re wondering "do I need to see a mortgage broker", here are ten reasons why most borrowers might consult mortgage brokers.
1. Brokers manage the whole mortgage application process from lender selection to home loan settlement
If you have any doubts about applying for a home loan, consider meeting a mortgage broker. They are licensed experts deeply familiar with the process of applying for a home loan. A good mortgage broker should be able to help you with almost every aspect of the home loan application process until you sign the loan agreement and sometimes even after that.
2. Brokers can point to the right lender for the right circumstance
Through their industry networks, mortgage brokers have a great deal of information about banks as well as non-bank lenders who offer home loans. They may have even assisted someone with a profile similar to yours, and can therefore leverage that to give you the advice you need and direct you to the most relevant lenders.
3. Broker are experts at navigating the complexity of a bank’s lending criteria
You may visit a mortgage broker only to confirm that you’ve chosen a suitable home loan offer and can’t get a better deal.
However, mortgage brokers are usually qualified to review your income, savings, and credit history in much the same way as many lenders. By doing so, they may be able to give you the lender’s perspective on your home loan application without the risk of your application being rejected and impacting future applications.
4. Brokers can negotiate with lenders to get you a better interest rate
In most cases, mortgage brokers recommend a lender from their list of preferred lenders, called a Lender Panel. Even outside this panel, they would have dealt with multiple lenders and therefore developed relationships with the lenders. These relationships can help ensure that you get favourable loan terms, such as a lower interest rate or low initial deposit. They may even have exclusive deals with particular lenders.
5. Brokers may handle much of the application process for you
When you consult a mortgage broker, you’ll get an insider’s perspective on the home loan application, including the documents lenders prefer. For instance, you may be self-employed and not have payslips or even sufficient tax returns. In such a case, a mortgage broker can help you regarding other documents accepted by lenders, or lenders who require fewer documents.
Consider asking if your mortgage broker can connect you with an accountant in case you need to prepare financial statements as a self-employed borrower. You will then just need to supply the documents, and they handle the inputting of the information into the application.
6. Their expertise speeds up the application process
A good mortgage broker will have a thorough knowledge of the Australian home loan market including the fine print of most loans., They can leverage this knowledge to speed up your application process. For example, a mortgage broker may be able to negotiate with a lender and not just get your loan pre-approved faster, but also reapply on your behalf when the pre-approval expires with minimal input from you. Which can get on the path to owning that dream home as soon as you find it.
7. Brokers can make applying for a home loan cheaper
Applying for a home loan can get expensive when you add up all the upfront costs, and you aren’t eligible for discounts or government schemes for borrowers. When you discuss your situation with a mortgage broker, they may be able to spot opportunities for savings on these costs such as which lenders have lower fees.
8. Brokers may help you avoid damage to your credit rating
If you don’t have much experience with home loans, you may end up applying for multiple loans at once. Which can affect your credit score negatively, impact the chances of any application being approved and make it harder for you to apply afresh for a mortgage. One way to avoid this is to use a mortgage broker who can offer advice regarding the right lender who can meet your home loan requirements.
9. A broker can offer you personalised borrowing choices
Seeking a mortgage broker’s advice on home loans can get you personalised offers rather than offers loosely tailored to borrowers with similar circumstances to yours. This knowledge can help you avoid a prolonged negotiation or, worse, applying without fully taking into account your specific circumstances.
10. They may not cost you anything at all
Most of the advice you get from a mortgage broker is invariably free of charge, as they get commissions from the lenders on their Lender Panel.
As part of their licensing requirements, mortgage brokers need to disclose to you whether their services come with a cost. If you retain their services to help you monitor available loans after you’ve been approved for one, you may have to pay them a consulting fee.