Buying property can be a confusing and overwhelming experience, from finding the property to getting the extensive documentation ready for the home loan, exchange and settlement. Using the service of a mortgage broker can make the experience a stress-free and smooth transaction.
So what exactly do they do? Essentially, a mortgage broker acts as a go-between for lenders and borrowers and their services of usually free of charge. They have access to a range of products through a panel of lenders that they are associated with. They’ll listen to your requirements, help you decide what features you’d like in your loan and source a number of options most suited to your individual needs. They will also take care of the paperwork necessary to confirm your home loan, lodge the documents on your behalf and provide all the tools and advice for repaying the loan efficiently.
But how do you choose the right mortgage broker for you? These useful tips will help you select the best professional for your needs ensure you get the best value from your mortgage broker.
There are a growing number of mortgage brokers in the industry, so take your time and shop around for the best fit for you. Ask your family, friends and colleagues for recommendations they may have or have heard of. Reputation and past performance are very strong indicators of their value so do your research online first, find some client testimonials and then opt to go and meet a few brokers face to face for an initial consultation.
Trust building and rapport is a critical factor when deciding on your mortgage broker so get a feel for whether you can work with them in the long term and whether they’ve got your best interests at heart. Use your meeting to find out if the broker is punctual and organised, has a solid knowledge of the products they offer, has excellent communication and customer service skills and is confident in their overall approach.
Also ask for the broker’s accreditations. All brokers must be accredited under the National Consumer Credit Protection Act, be a member of the Mortgage & Finance Association of Australia (MFAA) and/or the Finance Brokers Association of Australia (FBAA) as well as being a member of the Credit Ombudsman Service Ltd (COSL).
Go to each meeting with a list of questions you want answered. Don’t let the broker do all the talking and make sure you get all the information you need in simple terms that you can clearly understand (especially if it’s your first time taking out a loan).
A few keys questions to ask can include:
● How long have you been in the industry?
● Can I speak to another one of your clients?
● How does your service work?
● Do you specialise in any particular type of client?
● How will you look after me in the process of getting a loan?
● What happens after the loan has been settled?
● What qualifications do you have?
Good brokers should have access to an extensive range of reputable lenders, this increases their validity within the industry and if not, you could be missing out on better mortgage deals. Ideally, they should have access to a mix of both traditional (banks, credit unions and building societies) and non-traditional (wholesale or non-conforming) lenders.
Ask the broker to tell you about all the lenders they coerce with and how many of them they like to use and why. Also find out which products they will be comparing for you and from which lenders. Ensure the product your broker is offering matches your needs and ask for an explanation of all the documentation surrounding your loan application and contract as well as a loan product fact sheet. This will outline the critical points about the loan being offered, including interest rate and features of the product.
Asking for a comparison rate table is also useful so you can see for yourself which loans and and lenders are being analysed. This can help you determine which home loan will work best for you financially and give you that extra confidence that the broker has comprehensively sought out the best deal for you.
Most mortgage brokers offer their client services free of charge and are paid a commision by the credit providers. They must disclose the commission paid to them by lenders, so ask your broker about the benefits they receive.
Overall, when selecting a mortgage broker that’s best suited to you, focus on the essential criteria of integrity, reliability and trust. A mortgage professional with an exceptional reputation within the industry as well as among the client community are also strong indicators of value and desirability for you as a potential customer.