Major purchases like a house or a car can rarely be paid upfront. Typically, you would need a mortgage to pay off the property or the item by installments. This is a sound choice financially and one that many people engage in every year.
The real problem starts with finding the right lender who can offer a loan deal that addresses your specific needs and requirements. There are many lenders out there, but not all of them have your best interests in mind. One thing you can do to prevent any future problems with your mortgage is to find a reputable mortgage broker in the Gold Coast or in the area that you live in.
Mortgage brokers can point you to the right home loans, prepare the paperwork, give your loan processing journey a push, just to name a few. Their roles do not just end there. So, if you are planning to work with a mortgage broker, then here are some questions you need to consider before choosing one.
Do you need a mortgage broker?
It is possible to find and apply for a loan without the help of a broker, but doing so comes with a lot of risks. By taking loans without professional advice, you might end up with a loan deal that isn’t really compatible with your needs and payment capacity. Both scenarios will just cost you a lot more in the future.
You also increase the chances of being rejected by your chosen lender. See, mortgage brokers have built their careers over time. This means that they already have a good standing relationship with lenders in the area. They can even negotiate and strike better deals by simply communicating with the lenders.
Given that you have sufficient background in finding, negotiating for, and processing good loan deals, then you can safety trudge ahead without a broker. But if dealing with lenders and handling the whole application process seem daunting to you, mortgage brokers may save you time, money, and a lot more.
How are they different from loan officers?
Loan officers work for lenders such that they only offer the loans that their employers have. Unlike loan officers, mortgage brokers work independently from the lenders. Some brokers might work under a brokerage firm, but even so, their advice and decisions are often uninfluenced by the lenders they deal with.
One advantage of mortgage brokers over loan officers is that with the former, you get access to a broader selection of loans. This way, you can arrive at a decision that serves you best.
Which type of loan do you need?
The mortgage broker can open doors in terms of which lender you can take loans from. They can even negotiate on your behalf to ensure that you maximise the features of a specific loan deal. But before they can provide their services, you must at least have an idea of which loan type you need.
Do you need fixed-rate loans? Would you benefit more from adjustable-rate loans? You might also want to look into interest-only loans and negative amortization loans. But if all these are sounding too technical for you, then that might be where brokers and business advisors can come in.
Do you need to prepare a down payment?
In the country, the most typical down payment rate is pegged at around 20%, but this is not always the case. Nowadays, you can strike deals that do not even need a down payment. Many mortgage brokers in Gold Coast can lead you to loans that require little to no down payment at all. Brokers are open to any questions regarding this one, so make sure to ask when you can.
Before you lock in your decision…
Using the previous questions, you might have narrowed down your choices to a few brokers in your area. To further refine your choice, you can take a quick run through the considerations below.
Do they offer a credit guide?
The broker’s services, background, internal and external dispute resolution processes – these are just some of the pieces of information listed in a credit guide. Aside from these, you can also find out which industry associations they are part of and which lenders they work with. Through this, you can get a gist of the kind of brokers you are working with before you sign the dotted line.
Do they have professional memberships?
There are several professional industry bodies in the country like the Finance Brokers Association of Australia (FBAA) and the Mortgage & Finance Association of Australia (MFAA). Being accredited by either of these associations mean that their brokerage firm meets the annual standard professional development requirements.
Every broker must also have an Australian Credit Licence (ACL) or a Credit Representative Licence (CR). Make sure that when looking for a mortgage broker in the Gold Coast, they have both the licence and the membership to practice.
Do they discuss about your needs and goals?
Most brokers offer a free initial consultation for their clients. You can use this obligation-free consultation to gauge your broker. Are they asking you about your needs and goals? Or are they jumping straight into their recommended loan deals?
A broker who cares about quality services will most likely conduct an assessment of your needs first. Be wary of brokers who give out recommendations without even discussing your plans with you.
Are they transparent in every transaction?
It is not uncommon to hear stories about brokers who over-charge clients. Under the law, brokers are prohibited from claiming payment from the lender and the client at the same time. Usually, they are paid through one of the other. Make sure that your broker is transparent every step of the way, especially regarding the fees.
Want to learn more?
We hope you gained useful insights on mortgage brokers through this article. But if you want to learn more about how a mortgage broker in the Gold Coast can help you, feel free to browse more related articles on our website.
If you are ready to work with a mortgage broker, then you can work with our brokers here at FinKonsel. To learn more about how else we can help you, give us a call.