June 30, 2015

The Advantages of Using a Mortgage Broker

If you have not used a mortgage broker before, chances are you will have a few questions. We’ve put together a few of the main questions to help you understand the process.

What does a mortgage broker do?

In a nutshell, a mortgage broker acts as the middleman between you and potential lenders. It’s their job to compare mortgage lenders, find interest rates that fit your situation and needs and negotiate terms. They are essentially your loan guide and liaison.

A mortgage broker helps you apply for the loan and do most of the heavy lifting throughout the whole process, whether it be for a home purchase loan or a mortgage refinance. They compile all the necessary paperwork, including bank statements, credit reports and even your employment history. More importantly, they can determine issues which may create difficulties with one lender versus another.

Essentially a good mortgage broker works with you to:

• Understand your goals and needs

• Work out the amount you can afford to borrow

• Find the best options to suit your financial circumstances

• Explain how each loan works (e.g. features, interest rates and fees)

• Apply for the loan and manage the process all the way to settlement

Is it good to go through a mortgage broker?

Buying a home or refinancing is often a challenging and arduous task, given the financial requirements needed to get the job done efficiently. Fortunately, you can enlist the help of a licensed mortgage broker and enjoy the following advantages:

• Expertise in the market

Working with a mortgage broker means working with an expert in the home buying and refinancing process. Mortgage brokers have a working knowledge of the current housing and lending markets and ample industry experience to lean on. The expertise is incredibly beneficial in obtaining the best loan for your unique circumstances.

• Access to lower rates

Mortgage brokers have access to home loans with wholesale rates, helping you save money over the life of a home loan. For borrowers who have minimal financial means or challenging credit issues, having access to lower rates lets you get a mortgage that is affordable and suitable for your unique circumstances.

• A single application

Home buyers who work with a mortgage broker only have to submit one application for a new loan. This eliminates the need to provide multiple copies of financial documents and complete various applications. Your mortgage broker will do the majority of the legwork to help you get the best possible loan options.

Does it cost to use a mortgage broker?

Enlisting the services of a mortgage broker is free. You don’t pay them anything because they are typically paid via a commission from mortgage providers. But they also don’t work for banks, they operate independently and must be licensed. The commissions vary between individual brokers and banks. A typical range might be 0.5% to 1.2% of the full mortgage amount. The exact percentage depends on the mortgage type and its corresponding term.

When should you see a mortgage broker?

Whether you’re a first home buyer who is just starting out or a seasoned property investor who wants to save time and legwork, you can tap into the expertise of a mortgage broker. If you’re a first home buyer, your brokers will do all the paperwork and will even help you apply for government incentives such as the First Home Owner Grant. If you plan on refinancing, a mortgage broker can advise you on switching and make the process as easy as possible. If you’re a property investor, a mortgage broker will help you maximise returns with the right loan.

Mortgage brokers can help you with all these and more. Any time is a good time to take advantage of a mortgage broker’s experience.

What are the advantages of using a What If We Finance Mortgage Broker instead of going to a bank or other lender?

The most obvious advantage is that a What If We Finance broker can give you access to a large range of lenders and their products. This means you are far more likely to get the home loan that’s best for your needs.

Convenience is another important benefit. Your What If We Finance broker can come to see you at your home or office and will fill in most of the paperwork – a big saving in time and hassle.

Managing your home loan application is another big advantage. Your What If We Finance broker will follow up with lenders and settlement agents to make sure that financing occurs at the right time.

Your What If We Finance broker can also advise you how to get any stamp duty relief or first home buyer grants for which you may be eligible.

What type of home loans are available from What If We Finance brokers?

Your What If Finance Brokers provides access to home loans from all the main banks, building societies and other lenders. In total, they can offer a range of over 1000 products from more than 30 lenders.

Do home loans cost more if you get them from a What If We Finance broker instead of direct from a bank?

No. The costs are the same. From the bank’s perspective, whether it pays a What If We Finance broker or an employee, either way there is a cost associated with selling a home loan.

Do I have to pay a What If We Finance broker to set up my home loan?

No. What If We Finance brokers are paid a commission by the lender that provides you with a home loan.

If I buy a home loan from a What If We Finance broker, do I still need to go to see the bank or other lender who provides the home loan?

No. This is all handled for you by the What If We Finance mortgage broker.

What documents do I need to take out a home loan?

  • Proof of income, in the form of the past 2 or 3 payslips – if self- employed,you will need financials going back 2 or 3 years;
  • Group Certificate or Tax Returns
  • Evidence you have the required deposit, usually a bank statement showing the funds will be sufficient;
  • An accepted offer of acceptance (i.e. signed by the vendor);
  • If you have a credit card, a statement showing your credit limit;
  • 100 points of ID – a passport or birth certificate and driver’s license is sufficient.
  • Different lenders have different rules, your What If We Finance Mortgage Broker will advise on what you require based on the lender that is best suited to your needs.

Contact your mortgage broker today to find out more.

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