06 Sep Banks versus Broker
Spring is the time when home buyers and property investors are busy attending open for inspections every weekend.
As part of the buying process, most of them who are seeking a loan would ask…. “Is it better to go to the banks directly or should I engage a mortgage broker?”
In full disclosure, I am a mortgage broker and while it might be construed as being biased, but ask yourself the following questions before deciding:
- Will the bank propose a competitor’s product if none of their products suit my situation and needs?
- Will the bank staff take time to understand my current and FUTURE goals before proposing a long term loan structure that can achieve those goals?
- Can the bank staff attend to me after hours as I’m unable to visit the branch during office hours?
I do believe that there are some unethical mortgage brokers in the market who are not acting in the best interest of their clients, hence choosing the right broker to work with you is important.
Some questions you should ask the brokers are:
- How many lenders and products do they have access to?
- What is their process to ensure the product they recommend meet your current and FUTURE needs?
- Do they charge you a fee?
- Are they home owners and/or property investors themselves? How many properties have they owned in the past?
- Do they have any strategic partnerships with complementary businesses such as lawyers/conveyancers, building and pest inspectors, accountants, financial planners, insurance brokers, real estate agents and buyer’s agents? Do they refer their clients to these partners because of the commission they get or because they think these partners are best able to help the clients?
All mortgage brokers should be able to get you a mortgage loan as long as you can show your serviceability. However, ALWAYS look for a mortgage broker that takes time to understand what your future goals are, and have the knowledge to structure a right loan to achieve them.