| What Is A Mortgage Broker & Should You Use One?

Mortgage brokers write over half of all home loans in Australia and growing.  It is easy to see why.

Mortgage brokers do most of the legwork for you, saving you going to all the lenders and comparing everything yourself. 

All you normally need to do is discuss your requirements with your broker, submit your application and documentation once –  and the mortgage broker does the shopping around for you saving you time and fees.

Mortgage brokers are financial specialists who can provide you invaluable advice and access to many finance products.  They will help you with many different aspects of your home loan that go beyond just the application process.  And it is usually free!

Their first task is to put together and manage your application and take the stress out of the process.   This process is becoming reasonably complex In today’s home loan market.  Part of this process is to help you determine what type of home loan will be right for you, and to paint a positive picture of your credit worthiness.

A good broker will be able to get you the best available interest rate and the type of loan that suits your circumstances and goals.   A small difference in the interest rate and fees, can make a huge difference in how much you pay over the life of your mortgage. 

A Broker May Be Able to Save You Money on Fees.
Setting up a mortgage often involves different fees (eg: origination fees, application fees, and appraisal fees) – A good broker may be able to negotiate to save you hundreds of dollars on these fees.

A good broker may also be able to liaise with both your conveyancer and real estate agent reducing your stress throughout the process. 

Just make sure you select your broker carefully.  Some questions that you might want to ask a prospective broker.

• It is important to find out how many lenders they deal with? One of the reasons to use a mortgage broker is that you gain access to a number of lenders and their different loan products all in one place.  
• How long have they been operating, and what relationships and networks have they developed?
• You can ask a broker what their fees and commissions are.  If they are a member of the M.F.A.A. – they are required under the Code of Practice to disclose their fees to you.
• Talk with them about switching costs, It’s important to ensure that the costs associated with switching are not going to outweigh the benefits.

You also need to communicate your needs clearly to your broker. (they are not mind readers).  

For your broker to help you achieve the best result, they need to clearly understand what you need and your goals.  For example:

• Is this your first mortgage?
• Why are you refinancing? 
• Are you living in the property or is it an investment?
• How long do you plan to keep the property?
• Are you planning any renovations?

Some brokers specialise in specific types of loans, you need to ask your broker what experience they have relating to your exact needs.  Some different types of loans can be complex and difficult.  Make sure your broker is capable of getting the best result for you.  

You can benefit greatly from a good broker’s experience.  They will:

• Make the process easy,  
• Speed up your application process, 
• Get you the best product and rate, 
• Minimise lenders fees, and 
• Save you substantial time and money.