Trusting someone with your finance isn’t a decision you should take lightly. Here’s how you can benefit by using a broker.
A plunge in sentiment towards banks, stricter lending criteria for investors, and better-educated consumers have all led to more than half of Australian home buyers now borrowing via a broker.
It’s easy to see the attraction: working out what is on offer from each institution can be time-consuming and confusing. And if you’re not careful, you could be damaging your credit score by applying for loans you’re unlikely to ever get approved for.
Trusting someone with your finance is not a decision you should take lightly so if you’re looking to take out finance or renegotiate an existing loan, here are the benefits of using a finance broker.
What are the benefits of using a broker?
They don’t work for the bank
A broker will take the time to get to know you to make sure they choose the finance that’s right for your situation, challenges and goals. They will know which lenders will have the product that will meet your needs. And, they negotiate for what’s right for you, not what’s right for one particular lender.
They compare the market for you
When looking for a loan it can be a bit of a minefield with so many different options available. Which bank? Which product? What about Building Societies, Credit Unions and Mutual Banks?
A loan broker can compare many different lending options from a number of different major banks and second-tier lenders. Even if you’re fixed on using your current bank, a broker can still advise on which product to choose and negotiate with your bank to ensure you get a competitive loan product for your needs.
You could end up with a much better deal
A broker will sit down with you to work out your financial goals and assess your borrowing power before they go about researching the market, comparing rates of various banks and lenders, and negotiating the loan on your behalf. A broker that stands out is one that provides personalised assistance and competitive choices.
They know how to get your application over the line
A skilled broker will know how to “package” your application to appeal to specific lenders. They’ll know exactly what strengths to highlight in your application and how to address any weaknesses. They understand lender policies and requirements which helps them deliver better outcomes tailored to your individual needs and circumstances.
They’ll help you get your ducks in a row
For a loan application process that’s smooth sailing, a good broker will be able to tell you exactly what paperwork you need in order to apply, and how to navigate any obstacles in the criteria set by different lenders. They’ll also identify anything you can do to improve your chances of being approved for a loan – including improving your credit rating and consolidating debt.
Lenders are wary of serial applicants so it’s important that you are presented in the best possible light, making it easier for your broker to match you up with a suitable lender and product first time round.
They value long-term clients over short-term wins
A good broker doesn’t disappear once your loan is approved. After settlement, your broker should follow up with you and provide you with an annual review of your loan. It means you can focus on living your life while your broker focuses on keeping your loan competitive and moving you closer towards your long-term financial goals.
How much will a broker cost?
For most home loans, the service of a mortgage broker is complimentary. Sometimes a brokerage fee can be charged for complex or unusual situations, including commercial properties. The reason why a brokerage fee may be charged is simply because of the time it can take to find a suitable lender and negotiate a strong deal on your behalf. Even so, in most cases, you’ll actually pay less by using a broker than going directly to a bank since they can often negotiate a better deal for you.
Let’s talk finance
To find out how The Loan Tailor can help you with your financing needs, contact Andrew Pantelas on 0410 731 292 for an obligation-free chat.
This article provides general information only and has been prepared without taking into account your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances and your full financial situation will need to be reviewed prior to acceptance of any offer or product. It does not constitute legal, tax or financial advice and you should always seek professional advice in relation to your individual circumstances. Subject to lenders terms and conditions, fees and charges and eligibility criteria apply.
Credit Representative 505348 is authorised under Australian Credit Licence 389328
Your full financial situation will need to be reviewed prior to acceptance of any offer or product.