Yes! And here’s why.
More and more people using mortgage broking services every day. Perhaps it’s that our TV screens are being filled with companies advertising their services or banks being tougher to approach, but the mortgage broking industry is booming.
The best thing about a mortgage broker is that they’re on your side, not the banks.
They work for you to find the best deal based on your current situation. They don’t work for a financial company or bank but have direct access to them all. And if you’ve found it hard to get a loan through the big 4 banks, mortgage brokers know the smaller companies who are more willing to help people in difficult circumstances.
Let’s run through what a mortgage broker can do for you.
The top 3 ways a mortgage broker works in your favour
1. ACCESS TO 30+ LENDERS
So many choices: Mortgage brokers have access to a huge number of lenders, from the big 4, mid-tier and smaller banks, right through to non-conforming lenders. The beauty of this is being able to find a lender who will work best for you, not just being pushed into one of the major financial institutions.
Adaptable to your situation: If you’re in a good situation with a stable job with good income, good repayment history and a small amount of debt, you’ll going to have more lenders wanting your business. But if you’re struggling, a mortgage broker will be able to help you consolidate debts and draw upon their lenders to help you get into a better position.
2. THE ABILITY TO NEGOTIATE BETTER DEALS
Playing the field: They can use their position to negotiate better rates with lenders as these lenders know that to win your business, they have to have the best option for you.
You don’t always need to move banks: Sometimes getting a better deal doesn’t mean you need to change banks. If you’ve been happy with your bank, a mortgage broker can speak to them to see if you’ve got the best current deal. For example, if your mortgage is 3 years old, you may not be getting the up-to-date discounted rate that new customers are offered. With a few emails and phone calls, a mortgage broker could have your interest rate lowered.
Getting fees waived: If a mortgage broker has a good relationship with a lender and does a lot of work with them, they may be able to get some fees waived for you. This is often the valuation or legal fees, and it’s common to see the annual fee waived for the first year of your loan. Some mortgage brokers have been known to get the annual fee waived for the life of the loan!
3. THEY KNOW THE INDUSTRY
Finding you the best deal: It’s the job of a mortgage broker to know the industry and stay on top of what’s happening in the financial world. Mortgage brokers get a feel for the types of loans banks are giving and will, therefore, know if you’ve got a chance for approval. You don’t want too many loan rejections showing up on your credit report.
Helping you in today’s tough market: Banks are tightening up and not lending as much as they did 12-18 months ago due to stricter ‘responsible lending’ requirements by regulators. Banks are also doing more checks into your living expenses and spending habits. A mortgage broker will talk to the lenders and get a feel if they’d be happy to accept your deal before any paperwork is done.
Making sure you don’t ‘over borrow’: If you’ve borrowed ‘too much’ in the last few years, you may find it difficult to refinance a better deal and may be stuck with your current bank. If property prices drop and interest rates increase, it will impact a lot of people’s affordability and lifestyle which will make for tough times. A mortgage broker knows the trends so can make sure you don’t over borrow on a loan from the start.
Tips for your managing your mortgage
Having a mortgage can be tough and is one of the biggest stresses on people. While interest rates remain low, try to make additional repayments or put some savings into an offset account. Building up your equity helps you with future loan security if property prices drop and interest rates rise.
Another way to save money and pay off more of your mortgage is to put most of your wage into your home loan account, with enough to cover expenses into a separate account. This stops you from seeing ‘spare’ money and spending it on things you don’t need.
And our final tip is to look at fixing a portion of your loan. If you’ve got budget restraints and even the smallest of rate increases will blow your budget and cause you to stress, you should look at fixing a portion of your loan. This works better than fixing the whole loan as you’re not limited to an annual amount you can pay off.
Want advice on your mortgage options?
Before you make the huge financial decision to get a mortgage (or refinance), it pays to speak to an Accredited Mortgage Consultant. Our team at EK Financial are here to help you, taking care of you all the way, from signing paperwork to loan settlement.
Email me at: aaron@ekfinancialgroup.com.au
Or call us on 03 9020 1888.
