When it comes to sourcing a home loan, there’s no denying that Australian borrowers are spoilt for choice when it comes to options. There are over 100 lenders offering a variety of mortgage products that may or may not be suitable for your needs. And that’s the case in point here – how do you know if you’re getting the best mortgage for your needs, and do you have the capacity and the knowledge to deliver the best outcome possible, or is it one of those things that you would do better to outsource to a mortgage broker?
While those looking for a home loan might be inclined to take the bull by the horns, so to speak, and approach the bank or home loan lender directly, it’s certainly worth taking a moment to weigh up the pros and cons of that decision. The thing is, doing so is unlikely to yield a cheaper interest rate, and while the lender is working to a quantitive target, a mortgage broker is genuinely working to build a relationship with you without prejudice.
It’s little wonder that more than two-thirds (69.3%) of new residential loans taken out in Australia between October and December 2022 were done so using a mortgage broker (as per data from CoreLogic on behalf of the MFAA).
Let’s look at some of the reasons why people may choose to use a broker instead of the bank for their home loan needs.
1. What services do mortgage brokers provide?
A Mortgage broker will do all the legwork for you acting as a conduit between the borrow and the bank.
They help you to clarify your home loan needs, looking at your short term requirements and your long term goals. All of these will factor into making a decision on which home loan will be best suited to your unique situation, bearing in mind that there are hundreds of different home loans available from many different lenders (with lots of lenders outside the “big 4” well known banks).
A Mortgage Broker can then help you with all the nitty gritty details and all the paperwork you will need for the home loan application. This is a huge part of their job, so they know what’s required and can streamline this whole part of the process for you.
Beyond that, the best mortgage broker will be able to identify and possible issues with your application before it is submitted and help you to present the most comprehensive and cohesive application, to avoid any delays or anything that may jeopardise your loan application.
2. Does a Mortgage broker have access to the cheapest loans?
We can’t speak for all mortgage brokers, but as a specialist mortgage broker in Perth, we certainly have access to hundreds of loan products from over 40 lenders. Compare that with the research you would be able to do on your own. It would literally take months and months for you to be able to research and compare the available loans on the market.
Of course, ultimately, buyers and brokers have access to the same loans, but mortgage brokers have the readily changing information at their fingertips and have their finger on the pulse when it comes to what’s happening with rates and products. They are also supported by their own business development managers at the banks whose job it is to keep brokers informed of any developments and new products.
Mortgage brokers are also often well positioned to negotiate discounts on your interest rate on your behalf because of these established relationships.
3. Can a Mortgage broker speed up the loan process?
This will absolutely depend on the circumstances and the home loan broker. A good mortgage broker will be crucial to submitting an accurate application and streamlining the process. If there is anything further that the lender requires, they will let the mortgage broker know and it can be resolved as quickly as possible, without having to go back and forth yourself. They also tend to make your life easier by helping you to understand the home loan process and helping you to make informed decisions.
Further to that, some mortgage brokers may be better than others in this situation depending on their relationships and status with the individual lenders. If you’re looking for a mortgage broker Perth, Base Home Loans actually holds platinum status with many of the home loan lenders, meaning that we can secure priority treatment for our clients.
As a Perth mortgage broker, we also tend to know if there are any lender-side delays and can help you to navigate that and avoid those who might jeopardise your purchase if it is time sensitive beyond the usual parameters for conditional and unconditional approval of your loan.
If you are leaning towards using a mortgage broker Perth, and you don’t have one in mind, here are a few key questions you could use to identify who might be best suited to help you.
- Is the broker licensed and a member of a professional body?
- How many home loan lenders are on their lending panel?
- How many dollars’ worth of home loans have they written in the last 12 months?
- Do they specialise in any type of loan? For instance, if you’re looking for a construction loan it may be worth finding a broker who specialises in those rather than residential mortgages.
- What kind of administrative team do they have behind them? A mortgage broker who manages everything themselves may have a slower mortgage pipeline
- Do they have positive online reviews from previous clients?
- If they recommended a particular loan, why that one? And are there cheaper loan options available?
In addition to those, here are some more questions for brokers suggested by ASIC’s Moneysmart.
You can also use this list of questions compiled by Canstar to find the best mortgage broker in Perth for your requirements.
If you’re ready to get started and work with a Perth mortgage broker for your home loan needs, we’re keen to hear how we can help. Get in touch here.
