How do you pick the right mortgage broker?
Searching for a home loan and buying property can be a very confusing and very stressful time. For most people it will possibly be the largest purchase of their life. For others it may be an investment opportunity. Either way it is important you find a mortgage broker who can make your life easier and ensure you understand the process.
If you have never bought a home before, jargon can be a real stumbling block. Ensure you find a broker who is happy to take the time to explain to you what all the terms mean. This is a very big deal and there is no such thing as a silly question so never be afraid to ask. You can have a look at our home loans glossary here.
Recommendations from friends and family that have had a good experience with a broker is always a good place to start. Ask around and see what experiences others have had. When searching for potential brokers see if they have clear and believable testimonials from past clients.
Just like shopping make sure you try a few on for size. Meet with potential brokers and get a feel for them. Similar to other professionals you deal with, you have to feel comfortable with the person that is going into bat for you.
Some things you need to consider
Do your potential brokers have access to a wide range of lenders?
Different loans suit different people at different times of their life. Obviously an investor will want a different type of loan to an investor and not all lenders will have a loan package for everyone. The more lenders your broker has access to the more likely they will be able to find a home loan to suit your needs.
How long have they been doing business with these lenders?
Do they have a good relationship with lenders to ensure they can facilitate the loan throughout the entire process?
Having a good relationship with lenders and one that has been in place for some time means that your broker can resolve any problems quickly, and present your loan application in the best possible way. Loan approvals can take some time and having a good relationship with lenders can make a big difference.
Do they charge a fee for their services?
Broker’s charges may vary. Some may charge you a fee for submitting applications or indeed if you change home loans you may incur a fee within a particular of period of time. All good brokers will be able to provide you professional advice but ensure that you understand any fees that they may charge.
Make sure you understand what home loan is right for you
Ask a lot of questions and when you are presented with loans ask the why this loan would be the right one for you. Your broker should be able to provide you with a clear and concise reasoning as to why this loan suits you. They should always have your best interests at heart and be able to explain why they are recommending something.
Experienced brokers will understand how to properly structure loans and debts in your best interests. They will ensure you receive an optimal result, reducing fees, maximising any benefits available and reducing interest on loans. This is done by including the use of special facilities, such as offset accounts, and optimal structure for future property investment. They should have the ability to liaise with an associated financial adviser to ensure the loans are being structured in the most tax effective way.
Find a broker that is reputable and experienced
A professional broker should have a track record and belong to professional associations. They should be registered with ASIC and have ties to reputable and recognised industry bodies. A home loan is more than just an interest rate, it needs to be tied to your personal circumstances. A good broker with experience will help you through the process and find the right home loan for you.
An experienced broker should be confident with any question you ask and should always be able to provide a measured and reasonable explanation. They should always rely on more than a computer program and ask questions to really determine what your needs are.
They have a duty of care to ensure they provide you with a home loan that is within your means and is suitable for your situation
Finding a great mortgage broker to assist you with your home loan may be a process but when you do find one it will have been worth the effort. You will form a long time partnership with them that will provide you with invaluable information as your loan needs shift and change over the years.
Ask your friends, check their credentials, check their testimonials, and ask them a lot of questions.
The more knowledge you have and they provide, the more informed your decision will be. The more comfortable you will be in trusting your broker to provide important financial information.