Advantages of Using a Mortgage Broker
If you are looking for a loan, using a mortgage broker is a wise decision. A qualified and licensed mortgage broker has in-depth information on the lending market. They will walk you through the entire process – from assessing the real estate market to analyzing bank loans and regulations.
What is a mortgage?
First things first – what is a mortgage and how does it work? A mortgage is a financial arrangement whereby you agree to a legal contract promising to purchase a home on loan and repay the debt over time. In that case, the property bought is used as collateral for that loan. If you clear the debt, the lender hands the property over to you but if you fail to repay as agreed the lender may repossess the property and sell it to cover the debt. In practice, mortgage transactions involve a lot of paper work and that is where the skills of a consultant are required.
What Is the Role of a Mortgage Broker?
A mortgage broker is licensed intermediary (go-between) that negotiates with lenders on your behalf. These professionals not only have a diverse range of products to suggest but also understand the bank approval guidelines which means they can be of help should your application hit a hurdle. Brokerage services come in handy when you are looking for somebody to do the legwork, run around and put the paper work together so you can avoid the headache of a competitive market-space.
Advantages of Using a Mortgage Broker
A mortgage broker will do the leg-work and support you throughout the entire application and settlement process. They will also provide you with quick, easy loan comparison so you can choose the most affordable choice available. In addition to that, you can always count on a licensed consultant to provide you with expert advice on various subtleties of loans and share real feedback from other clients. Other added benefits to consulting a mortgage professional include:
- Protection – a professional mortgage consultant has a duty of care to you. You will also be protected from possible loopholes and pitfalls.
- Industry knowledge – you get latest industry analysis and intel.
- Convenience – Mortgage consultants are generally very flexible to work around your schedule. If you have a question they are just a phone call away. No call centres or waiting in queues.
Services
Mortgage Loans
Mortgage loans are provided to assist home buyers with their property purchase. We work with you to determine your needs and take you through the process of obtaining pre-approval. We handle the paperwork and keep you fully informed at every stage.
Home Loans
Home loans are different from mortgage loans in that they don’t necessarily use the property bought as collateral. And because our consultants work solely for you, not the lenders, our promise is that we will assist you to make a confident decision after examining all potential roadblocks on your way.
Investment Loans
Investment loans are closely related to mortgage loans. As with other types of loans you can choose between; variable interest rate (where the rate you pay fluctuates with changes to the official cash rate), split rate (a blend of fixed and variable loans), fixed rate (interest rate is locked so investors have certainty about repayments).
Business Loans
Business loans are designed to assist you with major investments, nurturing growing firms and facilitating business operations. There are two main types of business loans namely fixed loans and variable loans. We can help you choose a good loan option to improve your cash flow and help you expand your ventures.
Personal Loans
If you are planning to buy any item today or finance some personal obligations you don’t have to wait for too long provided you can meet the repayments now. Our personal loans consultancy will help you find secure and affordable financing options, when you want it.
Does a Mortgage Broker Need a License?
Yes, in order for one to practice as a mortgage consultant they need to gain an Australian Credit License (ACL) and be registered by the Australian Securities and Investments Commission (ASIC). Besides that, one can seek further accreditation by joining the Mortgage and Finance Association of Australia (MFAA) or the Finance Brokers Association of Australia (FBAA).
Mortgage Industry Regulations in Victoria
The mortgage industry as with other credit-related services is regulated to protect clients from fraud schemes or cases of gross misconduct. For instance, the ASIC Regulatory Guide 204 of 2013 requires that mortgage consultants be (a) Competent, of good character, diligent and honest (b) With no conflict of interest in performing their roles (c) Not disqualified by law from practicing.
A specific criteria for choosing a person who is “fit and proper” is outlined in Prudential Standard APS 520.
5 Tips For Choosing The Right Broker
Finding a mortgage expert involves more than just looking for cheap interest rates, you want to work with only the best consultants, staffed by top professionals who will explain the ins and outs of the process. Find someone who is properly accredited, with enough experience and capacity to handle your requests. Ask the right questions before you commit to any deal. Look for a broker who promptly responds to client queries. Be wary of consultants with a long list of complaints, negative testimonials or bad customer service. Here are 5 tips in brief.
- Only work with accredited and licensed experts
- The more experienced the broker, the better
- Good customer service is key
- Clean track record
- Passion for the job
Conclusion
Mortgage brokers have a legal obligation to ensure that you’re not placed into a loan that is unsuitable for your needs and capacity. They are required by law to ensure you get “responsible lending” by giving you a credit guide with details of fees, licence number and your right to complain.
Remember, when you buy a home, you get into the deal for the long haul. You will have a commitment to repay the mortgage for 15,20 or even 30 years after all. Pick the wrong mortgage representative and you could wind up in financial trouble after going with the wrong package.
Don’t be caught up in the wrong deal due to avoidable mistakes or miscalculations. Get advice from mortgage experts today by talking to our friendly team today.
