7 benefits of using a mortgage broker

But given the wide array of potential providers in the market, where do you start? What papers do you need? How do you even start the process? 

Finding the best home loan or finance doesn’t have to be hard. If you want to remove some of the legwork, stress (and headaches) from this process, working with a mortgage broker might be the best option for you.

So, let discuss what a mortgage broker is and what they can bring to the table. 

What is a mortgage broker? 

A mortgage broker is a licensed and regulated financial professional who can guide you through the process of finding a home loan or finance. In the simplest sense, serve as a middleman between you (a home buyer) and the lender.  

Typically, you will need to do most of the legwork and the research to find out which provider offers the best rates and benefits. You will also need to contact the lender and finish the paperwork, which can be not only time-consuming and stressful but also costly.

But if you choose to use the services of a mortgage broker, you will not need to do any of the work yourself. A mortgage broker will work on your behalf at almost every step of the process, from start to finish. 

This means that they will do all the legwork, researching products on the market from the hundreds available and work directly with the lender to support you through the application and settlement process. 

Most importantly, mortgage brokers will ensure that you have a full understanding of the paperwork and terms and conditions before signing the bottom line.

What are the advantages of using a mortgage broker?

 Here are some of the ways working with a mortgage broker can benefit you: 

1. Save money

Buying a house is a big financial decision that can make or break your financial situation. If an inexperienced home buyer chooses a mortgage that does not have their best interests at heart in the long-term, it can be a very expensive mistake. 

By enlisting the services of a good mortgage broker, you can save yourself from the financial stress that comes with choosing the wrong mortgage provider.  

2. Save time

Applying for a mortgage is a time-consuming process. The initial stages involve a combination of phone calls, emails and meetings. Next is the gathering and providing a substantial amount of documentation to be reviewed, queried and explained.

Now imagine doing it several times. Sounds stressful, right? This stage of the process involves a huge amount of time and effort, which you may not have if you choose to do it by yourself. 

If you choose to work with a broker, this process will be streamlined and in turn, will be saving you time. You can discuss the requirements with a broker once. You will also need to provide documentation also once. The broker will then assess multiple home loan options and present you with a summary of the top contenders. Most importantly, they will recommend a lender that is the most suitable to your unique circumstances and requirements.

3. Access to a wide range of options

Unlike a bank that will only offer its own products, a mortgage broker has access to a wide range of loan options, which gives them a bigger scope to find the best home loan suitable to you.

Mortgage brokers have regular contact with a wide variety of lenders, some of whom you may not even know about! This makes it easier for them to connect home buyers with appropriate loans and consequently find the best deal. 

4. Pre-qualification

 If you’re not aware yet, unsuccessful home loan applications can leave a mark on your credit history. 

Mortgage brokers have access to the latest loan information across the lending industry that can help them match a perfect lender to your individual situation and goals.

It gives you an insight into your borrowing power and which lenders are most likely to give their stamp of approval to your loan. It also reduces the chance that you’ll be turned down several times and get marks against your credit history.

 5. Quick and easy loan comparisons

While a quick Google search can help you find a loan option that you think might suit your needs, it’s still advisable to do your shopping beyond the internet. If you genuinely want to save money and time while getting the best offers, a mortgage broker will give you access to better products.

Additionally, comparisons can take a long time. If you have a full-time job, finding the time to do your research can be difficult. You can save yourself from all the trouble by hiring a mortgage broker. Some mortgage brokers also have access to specialised software that allows them to provide you with dozens of options in minutes, saving you time and from the hassle of speaking to individual lenders. 

 6. Experience and expert advice

Most borrowers look at their options by only focusing on interest rates. But a mortgage loan is more than fees and other costs. 

Your broker can explain the various subtleties of the different lenders and loan options, which can make a big difference to your bottom line and potentially save you thousands of dollars in interest repayments.

A good mortgage broker also can steer you away from certain lenders with deceitful payment terms hidden in their mortgage contracts.

For example, it may be more advantageous for you to make extra repayments or gain access to a loan offset account. A mortgage broker can take you through both the pros and cons of all the options given to you. All these pieces of information are crucial to getting a good deal. 

7. Fee management

There are different types of fees involved when taking on a new mortgage or working with a new bank. Some of these include application fees, origination fees and appraisal fees. In some cases, mortgage brokers may be able to get lenders to waive some or all of these fees, which can save you a significant amount of money. 

Meanwhile, all mortgage brokers will vary in terms of fees, so ask about your new broker’s fee structure before the use of their services. Most mortgage brokers earn money on commissions shouldered by the lender, meaning their services are free of charge.

Be aware that some brokers may earn a higher commission from a particular lender, which they may be in favour of and lead you towards.