Many home buyers ask themselves the question, “why use a mortgage broker when I can go directly to a lender myself?”
The answer isn’t all that simple.
When comparing the services of a mortgage broker to applying for a home loan yourself, one isn’t necessarily better than the other. Instead, it would be best to consider which option is more suited to you, your financial situation, and your personal goals.
Therefore, we have put together this guide on why home buyers opt to use a mortgage broker and how a mortgage broker can help – and it’s up to you to weigh up the pros and cons against your personal preferences and requirements.
What Can Mortgage Brokers Do For You?
You begin your journey with a mortgage broker by discussing your current financial situation and penning down what your goals are.
From there, a mortgage broker can save you time by providing advice on what type of loan products on the market are suitable for you and helping you reach your financial goals.
A mortgage broker typically has to undergo studies and training to become qualified and receive accreditation with different lenders. Therefore, a mortgage broker typically possesses a wide knowledge of the different types of home loans and loan products, what features they offer, and which interest rates are appropriate at their disposal. They use this knowledge to give you recommendations on home loans most suitable for your situation.
Mortgage brokers act as liaisons between you and different lenders, which saves you the trouble of reaching out and communicating with lenders yourself.
A mortgage broker may be able to negotiate better deals and interest rates for home loans on your behalf and have experience with doing so.
Once you have chosen a lender under the guidance of a mortgage broker, your mortgage broker will then help you with the application process.
If you’d like to refinance your home loan or take out an additional loan, then a good mortgage broker familiar with your financial situation will be able to continue providing guidance.
How Using a Mortgage Broker Can Save You Time
Every mortgage broker will tell you that there is an extensive range of products on the market available to borrowers for home loans.
It can be exhausting and time-consuming to research all the different options, understand them, and find the right deal for you.
Once you have explained your situation and what you would like to achieve, a mortgage broker could immediately recommend certain types of home loans to you that will be to your benefit to save you time from having to do the research on home loan products yourself.
The process of preparing a loan application can be both onerous and stressful, so a mortgage broker may speed up this process.
A mortgage broker will also serve as a last line of defence, as they know exactly what documentation is required, how to obtain it and will make sure that everything is correct and in order before submitting it.
In doing so, the process of a mortgage broker reviewing your application will help preserve your credit score from any rejected applications. Borrowers become unattractive to lenders if they have multiple home loan rejections on record, so mortgage brokers take extra care when submitting a loan application to ensure it’s up to scratch.
How Using a Mortgage Broker Can Save You Money
When you do your own research independently from a mortgage broker, there’s always a chance that you could either miss something or misunderstand something. You could agree to something unfavourable and expensive without even realising it and at best, such as hidden or ongoing fees.
You may be able to drastically reduce those risks by using a mortgage broker. A mortgage broker serves as your point of contact and allows you to ask questions about things that you don’t understand and have things explained to you in layman’s terms so nothing is missed.
A mortgage broker can recommend loan products tailored to your financial situation. Most medical professionals know that they can qualify for a doctor home loan, but many other professionals might be eligible for specific discounts and a better deal without even knowing it.
Mortgage brokers can suggest money-saving options that borrowers had never considered, such as different ways to waive lenders mortgage insurance fees on home loans.
If you have the time and the inclination to do your own research, you could just go through the home loan application process yourself without the help of a mortgage broker.
But, having a mortgage broker do it for you could potentially save you time and allow you to become a homeowner sooner without having to pay an additional fee as a mortgage broker is compensated by the lender.
You might be thinking, why use a mortgage broker when there are many comparison websites available online that borrowers can use to compare home loan products and prices themselves.
Well, a highly knowledgeable and qualified mortgage broker who has done this many times before can navigate your home loan for you. A mortgage broker can identify perks, features and loan products you might not have established on your own.
Best of all, using the expert services of a mortgage broker is absolutely free for clients. Brokers are subject to the Best Interests Duty and aren’t allowed to suggest a service or product to customers that are not in their best interest.
There are various answers to “why use a mortgage broker,” some with pros and some with cons – you’ll just need to establish which works better for you.
Contact The Mortgage Agency today if you’d like to connect with qualified mortgage brokers who can assess your financial situation and help you find the right home loan best suited to your needs. A mortgage broker under our umbrella can help save you money, save you effort, and usher you in to your dream home.
Please note that every effort has been made to ensure that the information provided in this guide is accurate. You should note, however, that the information is intended as a guide only, providing an overview of general information available to property buyers and investors. This guide is not intended to be an exhaustive source of information and should not be seen to constitute legal, tax or investment advice. You should, where necessary, seek your own advice for any legal, tax or investment issues raised in your affairs.