More and more property buyers use mortgage brokers for their home and investment loans (including refinancing a loan) in Australia. Researches show over half of the loans in Australia are completed by Mortgage brokers. Businesses use mortgage brokers for commercial loans, leasing and property purchases also. If you are a first home buyer or new to the property market, you may wonder what a mortgage broker is and why you should use them.
What is a Mortgage Broker
Mortgage brokers are credit advisers with specialist knowledge of the Lending market; they are independent agencies between the lenders and the borrowers. Based on their experience, expertise as well as their assessment of their clients’ financial and personal situation, Mortgage brokers offer advice and assist property buyers to apply for the most suitable loan from various lenders on the market.
Advantage of Using an Independent Mortgage Broker
There are many advantages of using an independent mortgage broker such as a Mortgage Corp broker. Mortgage brokers can save you lots of time and hassle; they usually offer more competitive interest rate than a single bank; they have more options for you to choose from, and this is especially useful if your loan is not so straightforward; and their service is normally free, read why you should choose a mortgage broker over a bank manager.
8 Questions You Must Ask Your Mortgage Broker
Like anything, not all mortgage brokers are the same. Some are inexperienced, some lack professionalism, while some others are tied to a particular bank or funded by a bank. Therefore, it is important to ask if the mortgage broking firm belongs to a bank or financial institute and read online reviews and see what other people say about your potential mortgage broker.
Your home loan may be one of the biggest financial commitments you will ever make. Therefore, it is important to ask your mortgage broker as many questions as possible to make sure he/she will have your best interest at heart. It is also important to clearly communicate with your home loan broker your goals and the kind of lifestyle you want to have, and honestly answer any questions your broker asks you, so he/she can accurately assess your situation and recommend a home loan that suits your needs.
1.Do you have your own loan products?
If a mortgage broker is also a lender that has their own home loan product, you will need to be cautious, as they are likely to sell you their own products. They may have other lenders on their panel but do not be surprised that they may promote their products to be better than other lenders, in some cases this is considered ok, but get the right comparison. Make sure you ask them to compare all the hidden costs and benefits of different loans so you can make an informed decision yourself.
Some other brokers such as Aussie Home Loans and Rams are owned or partly owned by some lenders and have their own loan products which are funded by those lenders; whereas Mortgage Corp is an independent mortgage broking firm which is not owned by any lender and does not have their our own loans .We will only recommend loans from our 20+ lenders that are in your best interest, because we know, like many of our happy clients, if you are happy with our service, you are likely use us again for your next property and recommend to your friends and family.
2.How long have you been a mortgage broker?
An experienced and professional mortgage broker can save you time and money but an inexperienced mortgage broker may waste your much precious time and opportunity, and bring you more headaches than you need, and in some cases put you in a worse position. Buying a property and getting a loan can be stressful, you need a mortgage broker who can ease your burdens and make your life easier.
Mortgage Corp brokers have over 10 years of mortgage experience and have helped many property buyers fulfil their home buying dreams. Listen to what our customers say on Facebook about our Mortgage Corp Brokers.
3.How many lenders do you have on your panel?
Some brokers may have over 15 different banks and non-bank lenders on their book, whilst others may only deal with one or two banks. More lenders means more choice but be careful with brokers who deal with too many lenders as they may not know all their products well. If a broker mentions he has around 20 lenders to choose from, that is a good sign.
Mortgage Corp know all our lenders on our panel and have very strong working relationships with each, so when things need to be done you know, it is in good hands.
4.Is your service free? How do you get paid?
Mortgage Brokers service is usually free as they are paid a commission by the bank, this is the same as lender paying for branches and staff. But some brokers do charge a FEE FOR SERVICE, unless outlined and put in writing, you need to ensure it is explained upfront.
5. How much commission would you get
Mortgage brokers are legally obliged to disclose any fees and commissions. Good mortgage brokers such as Mortgage Corp’s brokers will recommend a suitable loan that benefits their clients rather than the lender that pays them most commission. Mortgage Corp brokers will also show you the amount of commission they will be paid by different banks to show you there is no hidden agenda.
Rest assure Mortgage Corp brokers’ commission is not coming out of your pocket and in most cases you will be paying less interest than if you deal with the bank directly. This is because most lenders would offer a discount rate to Mortgage Corp brokers due to the large volume of loans Mortgage Corp have brought to them.
6. What loan should I get?
If a mortgage broker does not ask you any questions and offer you a loan product straightaway, RUN! Every person’s situation is different and we all have different goals and lifestyle, there is no one loan that suits every person.
Your Mortgage Corp brokers will ask you a lot of questions to understand your financial and personal situation before making any recommendations on loan products.
7.What do I need to do myself and what will you do for me?
At the initial Loan Strategy Session, your Mortgage Corp broker will ask you some questions about you to understand your current situation and assess how much you can borrow and what loans may best suit you. He would ask you to prepare a list of documents and will try to get a pre approval for you first, so you can go to inspections or auctions and make an offer that you can afford. He would walk through the whole process and explain what you need to do and what he will do for you.
Your Mortgage Corp brokers will do all the leg works for you, research and compare different loan options; negotiate interest rate and terms with the lenders; fill out and submit all the paper work for you; and follow up with the bank and the other relevant parties to speed up the loan process. If you are ever stuck with anything, your Mortgage Corp’s mortgage brokers are just a phone call away.
8.Why should I choose you rather than some other mortgage broker or deal directly with a bank?
Listen to what reasons the broker gives you and make sure you are comfortable with him as a person. You do not want to deal with someone you dislike.
Mortgage Corp is a referral based business and over 80% of our business comes from referrals. Our customers satisfaction means more than anything to us.
About Mortgage Corp
Based in Wantirna South, Melbourne, Mortgage Corp specialises in helping successful professionals and property investors access discounted premium rates, minimise loan approval red tape and apply strategic loan structuring for long-term investment success.
Unlike many mortgage brokers that may be able to help you with general loans but simply don’t have the skills, experience or resources to genuinely help property investors maximise long-term wealth, Mortgage Corp loan specialists help investors develop a strategic approach to property investing for long term investment success. Request a Free Loan Structuring Strategy Session with our 5 Star Lending Specialist Neil Carstairs today!
About Neil Carstairs
Neil is the founder of Mortgage Corp, an active property investor and awarding winning MFAA credited finance broker with more than 10 years mortgage broking experience. Currently, Neil is one of only 19 MFAA Certified Mentors in VIC/TAS region.
He is known for his strategic approach to investing and ability to reach fast, successful outcomes for clients where his industry peers could not. Connect with Neil on LinkedIn.